Preamble

The House met at half-past Two o'clock

PRAYERS

[MADAM SPEAKER in the Chair]

PRIVATE BUSINESS

CITIBANK INTERNATIONAL BILL [Lords]

UNIBANK BILL [Lords]

Read the Third time, and passed, with amendments.

Oral Answers to Questions — WALES

Cardiff Airport

Mr. Denzil Davies: To ask the Secretary of State for Wales when he next intends to use Cardiff Wales airport in the course of his ministerial duties.

The Secretary of State for Wales (Mr. John Redwood): I last used Cardiff Wales airport on 8 September. I have no current plans to use it in the near future, but I will use it whenever my ministerial duties so require. I and my hon. Friends are keen to promote it as a good airport, and to see it as an important part of the south Wales economy.

Mr. Davies: Is the Secretary of State aware that the services to Europe, and in particular to Germany, from Cardiff Wales airport are abysmal? Manufacturing firms in my constituency and throughout south Wales, increasingly

require to get their executives and technicians to places such as Frankfurt and Dusseldorf and back in a day. That cannot be done at present. Will the Secretary of State spend his Department's time and resources to establish a daily return flight, five days a week, from Cardiff to Frankfurt?

Mr. Redwood: I am very keen to promote Cardiff Wales airport. I shall organise a meeting with business users and airlines to bring them together and to get more business through the airport. My hon. Friend the Parliamentary Under-Secretary of State was recently on the inaugural flight of the new service to Manchester. The Cardiff Wales airport needs more publicity and the right hon. Gentleman might think it a good idea to use the airport as neutral ground on which the Labour party ladies can get together and settle their differences. That would be newsworthy and promote the airport.

Mr. Sweeney: Will my right hon. Friend join me in congratulating Cardiff Wales airport on its profits last year? Bearing in mind that those profits represent a return of only 1 per cent. on capital for the taxpayer, does my right hon. Friend agree that now is the time to consider privatising Cardiff Wales airport?

Mr. Redwood: As my hon. Friend says, things have been moving in the right direction. I was pleased that the number of passengers using the airport increased by 50 per cent. last year to 900,000 and that the airport is in the black. We will look at all the options for the future of the airport. Anything that will increase business and make the airport a better asset for the people of south Wales will be high on my agenda.

Mr. Rogers: The Secretary of State will realise, or will have been informed, that Cardiff Wales airport was set up by a consortium of local authorities, and funded and paid for by the people of south Wales, not by Her Majesty's Government. Is not the proposition that the airport might be privatised another example of the Secretary of State's skulduggery and thuggery whenever he embarks on privatisation? He has no right to privatise an asset that does not belong to the Welsh Office. The airport belongs to the


people of south Wales, who have invested money in it over many years, and there is a great deal of anger about the proposition to steal private property yet again.

Mr. Redwood: Were we to decide to privatise the airport, the money would not be lost to the people of Wales. The hon. Gentleman might learn something of value were he to look at the great success that other airports in the United Kingdom have had since being privatised. Privatisation is an option at the moment, not a confirmed policy. I intend to consult and think about it before announcing such a policy.

Mr. Richards: When my right hon. Friend uses Cardiff Wales airport, will he take great care to avoid the harridans who have a tendency to prey on the right hon. Member for Llanelli (Mr. Davies)?

Mr. Redwood: I will, indeed, try to avoid those harridans. My hon. Friend has raised an interesting point about the in-fighting in the Welsh Labour party among its female members. I am delighted to note that the hon. Member for Caerphilly (Mr. Davies), who is sitting on the Opposition Front Bench, has been a beneficiary of the strange voting practices and received a better vote this year. I think that he owes that to the Welsh Labour party ladies.

Mr. Morgan: Does the Secretary of State agree that Cardiff Wales airport is a successful and profitable enterprise, which is a credit to its municipal parents, the three county councils of Glamorgan? Would he also like to reassure the employees at that airport that he does not propose to place it in the hands of one of those funny-money residuary bodies run by the usual Tory placemen from central casting and Central Office? Their action, in making a forced sale of that airport, would undoubtedly cost many millions of pounds in lower receipts to the Glamorgan ratepayers who set up that airport.

Mr. Redwood: I shall look at all the options for the future of that airport with the single question in mind as to what would be best for the south Wales economy. I agree with the Opposition that the airport is important to that economy. We need to increase services out of the airport in order to service the business community and other passengers. That would be my intention and there are a number of ways in which that may be pursued. My immediate task is to try to win more business for the airport in the way that I have already described.

Homelessness

Mr. Jon Owen Jones: To ask the Secretary of State for Wales how many people were recognised as homeless in Cardiff and Wales at the last date for which figures are available.

The Parliamentary Under-Secretary of State for Wales (Mr. Gwilym Jones): The figures are 671 and 2,703 respectively.

Mr. Jon Owen Jones: I do not know where the Minister got those figures, because I am informed that Cardiff city council had to cope with 2,700 inquiries on homelessness last year, which represents a 26 per cent. increase on the previous year. In the past six months, the number of inquiries has increased by a further 12 per cent.

What extra help will the Welsh Office give to local authorities such as Cardiff to cope with the huge number of homeless, which has increased as a result of Government policy?

Mr. Gwilym Jones: The answer to the first part of the hon. Gentleman's question is that the figure of 671 came from Cardiff city council and the figure relating to Wales came from the other Welsh local authorities. The hon. Gentleman should be aware that we have supported a project worth £800,000 specifically designed to try to help single, vulnerable, homeless people in Cardiff. I attended the launch of that project a while ago and I went to see one of the new homes provided by it, which was, incidentally, in the hon. Gentleman's constituency.

Mr. Jonathan Evans: Can my hon. Friend confirm that the majority of cases of homelessness are attributable to family breakdowns and to disputes between relatives, parents and the like? Those cases represent the big increase in homelessness to which reference has been made and which is recorded in the figures that have been produced by the Welsh Office, on the basis of information provided by Welsh local authorities.

Mr. Jones: My hon. Friend is correct. It is important to keep those figures in perspective. Of all local authority lettings and housing association lettings, only approximately 25 per cent. are taken by homeless people.

Mr. Alex Carlile: Bearing in mind the evidence that homelessness is increasing in Welsh rural areas as well as in the urban areas, does the Minister agree that it would be quite unacceptable if Government funding for Tai Cymru —Housing for Wales—were the victim of public expenditure cuts?

Mr. Jones: I acknowledge the question that the hon. and learned Gentleman has raised and the importance of funding for Housing for Wales will be given the fullest consideration.

Mr. Wigley: Is the Minister aware that of the 6,000 homeless cases involving children and/or pregnancies in Wales last year, only 500 involved pregnant single mothers, and of those only 47 were allotted permanent accommodation? In those circumstances, is not the Welsh Office going over the top in drawing attention to the plight of those people, rather than that of the 99 per cent. of homeless who do not fall into that category and who experience enormous difficulties in trying to find somewhere to live?

Mr. Jones: No, Madam Speaker. The Welsh Office is certainly not going over the top on that issue. In the interests of all the genuine cases who need housing, it is right that there should not be any unjustified fast track approach to obtaining either council accommodation or housing association accommodation.

Mr. Murphy: Does the Minister agree that he should go back to Cardiff city council to check his figures, since the total number of inquiries from homeless families in that city is nearly 3,000 and nearly 1,200 people were housed in temporary accommodation over the past year? Does he accept that a vital ingredient of family stability is a permanent home and cannot he see that the release of


council capital receipts to build homes for thousands of homeless people in Wales is worth more than 100 moralising speeches about single parents?

Mr. Jones: As I said to the hon. Gentleman's hon. Friend the Member for Cardiff, Central (Mr. Jones) the figures quoted were given to us by Welsh local councils, especially by Cardiff city council. I know of no money sitting idly not being used effectively for debt redemption. If there were any such moneys sitting idly, I would look to the councillors to pursue that situation energetically and if they failed to act, I would look to the local electors to show their disapproval at the earliest opportunity.

Poverty

Mr. Llew Smith: To ask the Secretary of State for Wales what response he has made to the pamphlet, "The Politics of Poverty in Blaenau Gwent", a copy of which was sent to him in September.

Mr. Redwood: I saw the pamphlet for the first time today and, like much Labour policy-making, it is long on gloom and doom and short on decent remedies. The best way of curing poverty is to create more jobs. That is why on 20 October I published details of the new five-year programme for the valleys to regenerate Blaenau Gwent and the other valley communities.

Mr. Smith: Is the Minister aware, especially after reading the pamphlet today, that, after 14 years of Tory Government, Blaenau Gwent still has one of the worst health problems in the United Kingdom? Is he also aware that in the past week, phase 1 of the Blaenau Gwent hospital commenced and that the commitment was given that phase 2 will commence in 1995? Will he reinforce that commitment and assure the House that the second phase will include a stroke unit? Is the Minister aware that the document was sent to the Welsh Office some 28 days ago and does it not say something about the operations of the Welsh Office that it has come into his hands only today?

Mr. Redwood: I am told that the pamphlet was not addressed to me so it was perfectly proper that it did not go straight to my desk. I have now read it, but, as I said to the hon. Gentleman, we have a big programme for rejuvenating and regenerating the valleys. I hope that he joins me in welcoming Sega as a new investor in Wales, through its links with AB Electronics and the 50 new jobs that that will generate at Abercynon. I hope that he welcomes the Treforest news of STNP creating 129 new jobs as well as 755 new jobs at Tesco. That is what matters —producing new jobs for the valleys, which the hon. Gentleman is asking for in his pamphlet.
Yes, of course, we will ensure high-quality health services and ensure that the right health facilities are made available for his area as elsewhere in the valleys, as set out in the valleys document that I sent to him.

Mr. Ron Davies: None of that is of any relevance whatever to the question asked by my hon. Friend the Member for Blaenau Gwent (Mr. Smith). Is not it clear from his report that, in 1993, a previously unreported depth of poverty and deprivation that arises directly from unemployment and low pay exists in Wales. It is the direct responsibility of the Government and it is an absolute disgrace after 14 years in office. My hon. Friend should be congratulated on his report rather than criticism being

thrown against him. Does not the Secretary of State realise that we need more positive action on jobs and low pay and more investment in housing, health and education? Is not it time that the Tory party started facing up to its responsibilities, rather than indulging in the hypocritical moralising of other people?

Mr. Redwood: The hon. Gentleman will not find me unwilling to accept responsibilities. I have set out in the valleys initiative the Government's major expenditure programmes for the next five years. They are geared to bringing in a lot more private sector investment as well, which is what the valleys require. The programme was very successful during its first five years and the number of long-term unemployed fell importantly and dramatically. I accept that much more needs to be done; I have never made any secret of that. The hon. Gentleman should listen and should read the valleys programme initiative because he will see there a bold vision of the future for a better south Wales, based on more jobs, more prosperity and more investment, which I hope that the Opposition welcome.

Beef

Mr. Fabricant: To ask the Secretary of State for Wales what initiatives he has taken to encourage the promotion of Welsh beef for consumption overseas.

The Minister of State, Welsh Office (Sir Wyn Roberts): Welsh Food Promotions Ltd. was set up more than two years ago with a remit to promote all types of food produced in Wales, including beef. The company works closely with Food from Britain in promoting overseas sales.

Mr. Fabricant: My right hon. Friend will be aware of the excellent taste and unique quality of Welsh black cattle. Is he equally aware of the grievous losses suffered by the breeders of Welsh black cattle since the imposition of the ban on exports because of the bovine spongiform encephalopathy scare? Is he aware that Welsh black cattle are fed on natural sources, such as silage in winter and grain in summer? Is he further aware that BSE exists anyway in continental Europe? What can my right hon. Friend do to promote the export of Welsh black cattle to Europe as a valuable earner of deutschmarks?

Sir Wyn Roberts: Of course, I am aware of the difficulties that the restrictions on exporting cattle, put into place as a result of BSE, have brought for many producers, and I sympathise with their position. However, the prohibition on the export of live cattle over six months old applies to all breeds of cattle and as Welsh blacks are among the breed types that have had confirmed cases of BSE, we are not likely to be able to advance the case for special treatment for that breed alone. Although a few cases of BSE have been confirmed in some member states, they are all isolated cases which are linked to feedstuffs imported from the United Kingdom. Exports to other member states are likely to remain restricted for some time yet.

Energy Efficiency

Mr. Dafis: To ask the Secretary of State for Wales how much money has been allocated by his Department to promote energy efficiency within housing in Wales in each of the last five years.

Mr. Gwilym Jones: It is for local councils to decide how much of the money that is given to them is allocated to energy efficiency schemes for housing.

Mr. Dafis: That is a disappointing response. I hope that, following the remarkable rally on Saturday in Cardiff by Friends of the Earth, the Minister recognises that there is now a formidable coalition in favour of energy efficiency, from social and environmental groups that see the issue as not only addressing the problem of pollution, but enabling people to bring about reductions of as much as 30 per cent. in their fuel bills, while providing important savings in other areas. Will the Minister now join me in congratulating neighbourhood energy action and its contractors on its excellent work? Does he agree that there needs to be a comprehensive programme in the area, which should be a central issue of economic policy as a way in which to bring it to fruition?

Mr. Jones: I should thank the hon. Gentleman for effectively endorsing the lead that my right hon. Friend the Prime Minister gave at the Earth summit in Rio. It behoves all of us to achieve energy efficiency, in the interests of Britain and of the globe generally.

Mr. Alan W. Williams: Rather than putting VAT on fuel and causing hypothermia among elderly people in the winter, why do not the Government introduce a comprehensive home insulation programme? It would have a rapid payback, in perhaps four or five years, and it would help to keep people warm in the winter rather than cause hardship.

Mr. Jones: I can reassure the hon. Gentleman that we are already seeking to carry out such a programme. In our estates partnership programme, it is a requirement that energy efficiency should be considered. Housing for Wales is this week publishing a new consultation document which looks for improved energy efficiency schemes in housing association developments.

Job Safeguards

Mr. Flynn: To ask the Secretary of State for Wales what new proposals he has to safeguard jobs in Wales.

Sir Wyn Roberts: The way in which to safeguard jobs is to ensure a steady economic recovery and sustainable growth. Our strategy—low inflation and sound public finances—does just that. We are also pressing ahead with our policies on deregulation, on encouraging enterprise, and on fighting for open and competitive markets.

Mr. Flynn: Why is the Welsh Office standing by watching so many winning Welsh teams being wrecked? I refer, for example, to the jobs in the brilliantly successful Du Pont group in Pontypool. The Patent Office in Newport is under threat although it has just been awarded a chartermark. Does not the Minister realise that many of the regional policy successes are likely to be destroyed by the Government's mania for privatising everything? Will he give a guarantee today that if privatisation goes ahead, none of the jobs that have come to Wales, such as those at DVOIT in Swansea, the Accounts Services Agency and the Patent Office, will be relocated outside Wales?

Sir Wyn Roberts: The hon. Gentleman is aware that his question about the Patent Office in his constituency is a matter for the Department of Trade and Industry and for

the President of the Board of Trade. The hon. Gentleman talked about getting rid of jobs. He did not mention all the jobs that have come into Wales. My right hon. Friend the Secretary of State talked of today's announcement from Sega. Over the past few weeks, we have had announcements about Hamilton Oil at Connah's Quay in north Wales, and further jobs created by Asat and Aiwa in south Wales.

Mr. Matthew Banks: Does my right hon. Friend agree that one of the best things that the Government can do to safeguard jobs in Wales is to continue the polices of promoting the right economic climate, which have been so successful in promoting existing businesses as well as attracting new business opportunities?

Sir Wyn Roberts: My hon. Friend is quite right and I am reminded that Wales continues to get 20 per cent. of the United Kingdom's inward investment. It is worth remembering also that some 40 per cent. of European investment from outside Europe comes in to the United Kingdom. Our job is to continue that good work and to support the companies that have come here. I am delighted to say that we are doing that through the export missions that we are leading abroad.

Mr. Donald Anderson: Will the Minister look with great care at the special problems of the construction industry in Wales, which is now flat on its back and has many jobs haemorrhaging? Surely that industry is heavily dependent on the public sector. Is there not a real danger that, in the Budget, there will be a twofold pressure on the construction industry, both from national ordering and local government ordering as a result of the pressure on local government expenditure? Will he look at the problems of the construction industry, which can create or destroy so many jobs?

Sir Wyn Roberts: The hon. Gentleman realises only too well that a considerable public sector capital programme exists in Wales. One of the areas for which I am responsible—roads in Wales—is running at a record level of some £200 million a year. Like the Chancellor, I am in the Budget purdah, but I am sure that, unlike the Labour party in the 1970s, we shall seek to protect capital spending even if it means cutting revenue spending.

Mr. John Marshall: Does my right hon. Friend accept that inward investment in Wales would be killed if we introduced a national minimum wage or signed the social charter? Is not it significant that those who seek to sell Wales short will destroy the Welsh economy by the restrictions that they suggest?

Sir Wyn Roberts: The Government are accustomed to hearing Opposition right hon. and hon. Members run down Wales. My hon. Friend is absolutely right. On the one hand, they complain about wage levels in Wales, even though since 1990 wage levels in Wales have been rising at a faster rate than in the rest of Great Britain. At the same time, they argue for the minimum wage, which would certainly be a cause of increased unemployment in Wales.

Mr. Rowlands: Is it not the case that the right hon. Gentleman and his predecessors have failed hopelessly to safeguard jobs in the south Wales coal mining industry? There are no pits or jobs left in communities such as mine, which has resulted in 40 per cent. of men being either out of work or economically inactive. What new initiative does


he have to create male jobs and male employment? The right hon. Gentleman should not just wave glossy brochures, which do not contain a new initiative in that respect.

Sir Wyn Roberts: Before the hon. Gentleman denigrates the valleys initiative, he should remember that, were it not for that initiative in 1988, we should be 10,000 jobs the poorer in south Wales. He must understand that the programme, which my right hon. Friend the Secretary of State has just extended, means £1 billion of investment in the south Welsh valleys. That will improve the quality of life for the people of the valleys and bring in new jobs.

Mr. Ron Davies: That is an untrue and utterly outrageous claim. In every travel-to-work area in the region covered by the valleys initiative, unemployment rose during the time of that initiative.
I draw the attention of the Minister to a speech made by the Secretary of State for Wales at Cliveden on 30 September, when he said:
in the European Community, a single currency would be bad news.
How does the Minister think that that can be reconciled with the European summit decision of last week to press ahead with full economic and monetary union and what Helmut Kohl described as a "very personal commitment" from the British Prime Minister? Is it not clear that there is a massive difference of opinion between the Secretary of State and the Prime Minister? Given that the Secretary of State has lost all credibility, how does he think that he will safeguard his own job, let alone that of anybody else in Wales?

Sir Wyn Roberts: I am sure that my right hon. Friend the Secretary of State can safeguard himself as well as his job.
On the hon. Gentleman's first point about unemployment in the valleys, United Kingdom unemployment is now more than 24 per cent. higher than it was in 1988 when the first programme began, but in the valleys it is 4·5 per cent. lower, which means that there are 10,000 more people at work in the valleys than there would have been had we followed the national trend.
As to the hon. Gentleman's comments about the events of last week, I am sure that it is right that we should be at the heart of Europe. We understand only too well that arguments about the future course of Europe will proceed and will be with us for a long time to come.

Cereals

Mr. Roger Evans: To ask the Secretary of State for Wales what criteria he proposes to adopt to identify specialist cereal growers for the purposes of the cereals regime in Wales; and if he will make a statement.

Mr. Redwood: I announced on Friday the arrangements that I propose for 1993–94—a division into two regions based on land suitability for growing winter cereals, and cropping patterns in the 1989–91 growing years.

Mr. Evans: I thank my right hon. Friend for that announcement, but the criteria are complex. Why could he not have approached the matter on the basis of simply identifying individual farms?

Mr. Redwood: The European Community regulation does not permit us to single out individual specialist growers or farms for support. I hope that when my hon. Friend studies the detail he will see that we have endeavoured to produce the right answers on covering specialist growers in the map that we sketched. As my hon. Friend will have noticed, we are out to consultation on the thrust of the matter of the proposals, so if he has a hard case or a difficulty, I hope that he will make his representations either to me or to the Welsh divisional office, which will be only too willing to help his farmers or those in the constituencies of other hon. Members.

Local Government Commissioner

Mr. Thurnham: To ask the Secretary of State for Wales what representations he has received about the latest report from the Local Government Commissioner; and if he will make a statement.

Mr. Gwilym Jones: None.

Mr. Thurnham: Is my hon. Friend aware that the ombudsman's report contains 10 pages of criticism of maladministration by council housing departments? Does he agree that the Government have done more than any Government to boost private home ownership? Is he further aware that the Opposition now have a policy document saying that the private rented sector badly needs a boost?

Mr. Jones: I acknowledge my hon. Friend's point about the Opposition's deathbed conversion to the importance of the private rented sector. Equally, I acknowledge what my hon. Friend said about bad practice in Welsh local authorities. We have been concerned about that for some time. In our agenda for action on housing, we gave a strong warning against political interference, and earlier this year we embarked on a consultation exercise into the housing allocation policies of all councils. We are now considering the replies to that exercise.

Mr. Roy Hughes: If only to safeguard the future of local government, will the Minister sack the inspector who awarded costs against Newport borough council for refusing permission to the American concern Browning Ferris for another waste disposal plant? Will he appreciate that the commissar-like attitude is alien to our democratic traditions in Wales and that the elected councillors were only acting in line with the wishes of the electors?

Mr. Jones: Matters such as that referred to by the hon. Gentleman would be considered in the proper quarters. The inspectors are charged with carrying out inquiries, and they do so to the best of their abilities.

Mr. Jonathan Evans: Does my hon. Friend agree that the report of the local government commissioners illustrates the way in which national institutions are exposing wrongdoing, even by elected local government councillors? Does my hon. Friend also think that the report, touching as it does on one of the local authorities in my local area and on authorities represented by Opposition Members, demonstrates the need for the Government to deal urgently with the issue of housing allocation?

Mr. Jones: I could not agree more with my hon. Friend. He is right in saying that Parliament gives scrutiny to that which needs to be scrutinised. A most amusing suggestion


which I saw recently was that some examples underline the importance of having a parliament for Wales. I thought that that was really saying that the Opposition is totally ineffective in scrutiny.

European Community

Mr. Win Griffiths: To ask the Secretary of State for Wales when he last met the leaders of local government in Wales to discuss EC matters; and what issues were raised.

Mr. Redwood: I last met leaders of local government on 31 October, when I discussed with them structural funds issues and EC initiatives generally.

Mr. Griffiths: In those discussions, did the local government leaders point out that more than £45 million of European regional development fund money will be lost to local authorities because of the capping policies of the Welsh Office and the Government? Will the Welsh Office and the Secretary of State now take action to revise the rules to enable local authorities in Wales to utilise fully the money available from Europe for economic and industrial regeneration?

Mr. Redwood: I am keen to see that local authorities take the maximum advantage; that is why we changed the system and made it transparent. We have made the credit approvals available for those projects which go ahead. I am working closely with local government to see that it gets the maximum benefit from the system.

Mr. Barry Jones: Has the Secretary of State received queries from local government about European moneys for next year's roads budget for Wales? Will the right hon. Gentleman assure me that the multi-million pound River Dee crossing scheme will begin next April as promised and that the great road project will not fall victim to the Chancellor's axe in terms of spending next year? Does he appreciate that the building of the crossing is urgently needed on Deeside?

Mr. Redwood: I understand that need and I will do the best that I can when I put together the Budget for Wales following the Chancellor's statement. I will take the hon. Gentleman's representations fully into account. He will understand that I cannot give him a 100 per cent. guarantee on any item for next year because we have not yet completed the Budget process.

Incomes

Mr. Ainger: To ask the Secretary of State for Wales what was the average per capita income in the counties of Dyfed and Gwynedd in 1992 compared with (a) the Welsh average, (b) the United Kingdom average and (c) the European average in cash and percentage terms.

Sir Wyn Roberts: The latest available data are for 1990, using gross domestic product per head as the measure. For Dyfed, the per capita income was 13·6 per cent. below the Welsh average, 28·1 per cent. below the United Kingdom average and 27·6 per cent. below the EC average. The corresponding figures for Gwynedd were 1·3 per cent., 17·9 per cent. and 17·3 per cent., respectively.
For the international comparison purposes, GPD per head is calculated in purchasing power units, not in cash terms. This cancels out price differences between member

states. In 1990, the GDP per head figures for Dyfed, Gwynedd, Wales, the United Kingdom and the EC were 10,484, 11,977, 12,131, 14,583 and 14,488 units, respectively.

Mr. Ainger: The Minister's reply confirms my worst fears that Dyfed and Gwynedd are among the lowest areas in Europe. From the figures given by the right hon. Gentleman, it would appear that we have the highest levels of poverty and unemployment.
Will the Minister assure me that the review being undertaken within the Welsh Development Agency will include no reduction in the efforts of the agency in trying to improve the situation in the rural parts of Dyfed and of Gwynedd? Does the Minister accept that rumours are circulating that there may be significant cuts in the rural initiative currently being undertaken by the WDA? Will he assure the House that that will not take place, bearing in mind the figures that he has just announced?

Sir Wyn Roberts: We should perhaps also bear it in mind that the cost of living in Wales may be rather lower than in other parts of the country. We should certainly bear it in mind that Wales is one of the most beautiful parts of Europe. I remind the hon. Gentleman of what I said earlier —that since April 1990, earnings have risen by some 21·2 per cent. in Wales compared with 20·4 per cent. in Great Britain. So we are making progress. Of course, it is very much in our interests and it is one of our ends and objectives to raise income levels in Wales.
As for west Wales and the Welsh Development Agency, the hon. Gentleman will be aware of the announcement made in January, which included the upgrading of urban development activities, enhanced rural development facilities in the area, enhanced marketing by the Wales tourist board, improved services to the local business community, and the appointment of an executive to promote inward investment in the area. Two of the travel-to-work areas—Fishguard and Haverfordwest—were upgraded to development area status.
The hon. Gentleman's point about the WDA is a matter for the WDA, but I am sure that it, and we in Government, will bear the hon. Gentleman's thoughts in mind. We are as anxious as he is to do our best by west Wales.

Oral Answers to Questions — CHURCH COMMISSIONERS

Bishops' Pay

Mr. Harry Greenway: To ask the right hon. Member for Selby, as representing the Church Commissioners what submissions the Church Commissioners have had concerning proposed pay and allowances for bishops with extra-territorial jurisdiction; and if he will make a statement.

Mr. Michael Alison (Second Church Estates Commissioner, representing the Church Commissioners): The Act of Synod will provide for the appointment of up to three new suffragan bishops to act as provincial episcopal visitors. Their remuneration will be the same as that of other suffragan bishops. Housing and a car will be provided and working expenses will be reimbursed.

Mr. Greenway: Will my right hon. Friend give an assurance to the House that the Church Commissioners will bear in mind the great concern expressed by the House


in last Friday's debate that priests and congregations committed to a male priesthood be properly looked after when females—ladies—are ordained as priests in a few months' time? Will he give an assurance that the Act of Synod measure which deals with the matter will give proper moral and real authority to those bishops committed to protecting those congregations and to serving them?

Mr. Alison: I am delighted that my hon. Friend has underscored the need for the co-called Act of Synod to have real teeth and real moral authority. I shall convey the anxiety that my hon. Friend has expressed to the General Synod when it meets at Church house next week to discuss the very point that my hon. Friend has raised. The Synod will underscore the need for an Act which is adequate. If it is not adequate, the House will insist that a Measure be brought before the House to create a statutory provision.

Mr. Frank Field: What action does the Estates Commission intend to take on the line in the Lambeth report about the scandalous loss of Church Commissioners' assets which said that the fastest growing area of expenditure was bishops' residences?

Mr. Alison: The bishops, led by the Archbishop of Canterbury, have launched a first diagnostic analysis of the funds and finances of the Church Commissioners. The New Testament utterance, "Physician, heal thyself, will be only too readily applied by those who have initiated this physicians' diagnosis.

Sunday Trading

Mr. Shersby: To ask the right hon. Member for Selby, as representing the Church Commissioners what is the policy of the Church Commissioners towards the investment of their funds in firms which trade on Sundays.

Mr. Alison: We believe that the law should be observed. We have expressed our concern to major retailing companies in which we invest and we shall continue to monitor developments.

Mr. Shersby: Is my right hon. Friend aware that many of the retailing firms in which the Church Commissioners invest have indicated to their Members of Parliament, including myself, that their preference is for option 2—the proposals of the Sunday Shopping Hours Reform Council —which would allow larger shops to open for six hours and smaller ones to open all day? Will my right hon. Friend be kind enough to bear that in mind and to convey the information that I have given the House today to the Church Commissioners?

Mr. Alison: I am delighted to hear from my hon. Friend that so large a number of retailers fall into the category that he has just designated. It is my hope and expectation that the group that he has specified will be able to co-ordinate that approach with the group that I personally support—the Keep Sunday Special group. I hope that, between us, we shall have a framework of law which offers full but generous and reasonable regulation for Sunday trading. Of course, the Church Commissioners are there to observe the law, not in any way to attempt to make it. We shall observe it through our shopping retail outlets as assiduously as possible as soon as the law is as clear as possible.

Oral Answers to Questions — LORD CHANCELLOR'S DEPARTMENT

Northern Ireland

Mr. Trimble: To ask the Parliamentary Secretary, Lord Chancellor's Department if he will make a statement on judicial appointments in Northern Ireland.

The Parliamentary Secretary, Lord Chancellor's Department(Mr. John M. Taylor): The Lord Chancellor is responsible for a wide range of judicial appointments in Northern Ireland. His policy is to appoint to each judicial post the candidate who appears to him to be best qualified regardless of gender, ethnic origin, political affiliation or religion.

Mr. Trimble: I must ask the Minister for further assurances in this matter in view of a rather disturbing incident that I heard about recently whereby a Roman Catholic barrister practising in Northern Ireland was approached by an Irish civil servant—a civil servant in the employ of the Republic of Ireland—and asked if he would be interested in taking a specific judicial appointment. I hasten to add that the appointment was not one within the gift of the Lord Chancellor. In view of that incident, which was improper, I ask the Minister to be sure that there is no interference by the Irish Republic in judicial appointments at any level. Can he ensure that the merit principle is properly vindicated and that there is no dilution in the quality of the Northern Ireland judiciary for political considerations?

Mr. Taylor: The hon. Gentleman takes me by surprise in this matter. He will not be surprised if I say that, not knowing, I have not been briefed, either. Now that he has put the matter in the public domain by raising it on the Floor of the House, if he wants to write to me indicating whatever terms—confidential or open—I will certainly look into it for him.

Magistrates

Mr. Harry Greenway: To ask the Parliamentary Secretary, Lord Chancellor's Department how many magistrates are currently aged 25 years or less; and if he will make a statement.

Mr. John M. Taylor: The answer to my hon. Friend's question is none. It is rare for anyone below the age of 27 to be appointed. However, there is no bar to appointment, and a 26-year-old has recently been appointed.

Mr. Greenway: Will my hon. Friend bear in mind the great gulf that seems to exist between young offenders and the magistracy, and that the best discipline in schools, in my long experience of schools, comes from that administered to children by their peers? They make the wisest and fairest decisions and ones that are most respected by other children. Does my hon. Friend agree that younger magistrates are needed to cope with the current problems of juvenile crime—and end the fuddy-duddy approach of some of the older magistrates and judges in this area? [Interruption.]

Mr. Taylor: Clearly, the House is not of one mind on this subject. However, it may like some information. No figures are kept on the ages of appointment of magistrates, but a recent sample of 875 new appointments showed—


this may surprise the House—that 22 per cent. were under 40, 33 per cent. between 40 and 45, 24 per cent. between 46 and 50, and 21 per cent. 51 and over. I found that evenness of spread quite healthy.

Mr. Janner: Does the Minister agree that what matters with the judiciary, whether magistrates or judges, is not age but whether they have ordinary common sense and administer justice properly? For example, the Lord Chancellor may have information on the age of Judge Prosser who saw fit to say that a well-known disease, repetitive strain injury, did not exist and should not be on the medical casebooks. Surely we could have some indication of the Lord Chancellor's approach to that sort of case, whatever the age of the judge or magistrate.

Mr. Taylor: In the case of magistrates, I think that personal suitability is fairly well defined as good character and repute and the ability to command the confidence of both the public and colleagues. As for judges, which the question is not about, there are already arrangements under which unfit judges may retire on health grounds whatever their age. [HoN. MEMBERS: "RSI?"] Meanwhile, the Royal Commission has considered the appraisal of judges, and its recommendations will be considered in due course.

Sir Ivan Lawrence: Is it not obvious that age and experience are important matters in the selection of judges, and that it cannot be for the confidence of the British people that young, inexperienced and immature magistrates are making judgments in serious matters? The Government's policy sounds sensible and intelligent—provided that a higher proportion of magistrates in the middle age range are selected.

Mr. Taylor: I had already reached the same conclusion about the virtues of the Government as my hon. and learned Friend. I shall take account of what he says about maturity. Plainly, maturity and experience are qualities that should be sought, but we do not want a bench on which there is no younger representation.

Media Coverage—Judges

Mr. Soley: To ask the Parliamentary Secretary, Lord Chancellor's Department what plans he has to issue guidance to courts on the effect of media coverage on trials.

Mr. John M. Taylor: The existing legislation on reporting of court proceedings is clear. I have no plans, nor has the Lord Chancellor, to issue guidance to the judiciary who, independent of the Government, apply the legislation for which my right hon. and learned Friend the Secretary of State for the Home Department has responsibility.

Mr. Soley: Is not the Minister missing the point? He must be aware of the case of the Taylor sisters who appealed successfully because of inaccurate media coverage. He will be aware of the police officers in the Birmingham Six case. Surely it is time to expect the media to report not only accurately but impartially between prosecution and defence so that press freedom is not sacrificed for wrongful conviction and vice versa.

Mr. Taylor: I respect the hon. Gentleman for his past work in these areas and no doubt I shall respect his present and future work. He invites me to speak about the Birmingham Six police case. In many ways, that case was

wholly exceptional. The decision was entirely for the trial judge. However, in staying the proceedings the judge held that the combination of delay, adverse publicity and the impossibility of isolating the very narrow prosecution case from the much wider matrix of events from 1975 was such as to render a fair trial impossible.

Mr. Maclennan: Is the Minister aware that there are severe restraints on academic examination of juries' attitudes, and that it would be helpful in considering this matter to have greater knowledge of how juries work and think? Will he look at the possibility of opening the work of juries to academic consideration?

Mr. Taylor: I thank the hon. Gentleman for his question. The deliberations on the Runciman report would provide exactly the right context in which to take the issue forward, as the hon. Gentleman would like to do.

Mr. John Marshall: My hon. Friend will have seen the coverage of the Austin Donellan case. Does he agree that in such cases the defendant should have the same right of anonymity, at least until proved guilty, as the victim of such crimes quite rightly deserves?

Mr. Taylor: I am well aware of these arguments. I thank my hon. Friend for raising the matter and advise him that my right hon. and learned Friend the Secretary of State for the Home Department has asked his officials to undertake a review of the question of anonymity in rape cases and in other sexual cases and of the interests of both parties in such cases.

Judges

Mr. Skinner: To ask the Parliamentary Secretary, Lord Chancellor's Department if he will introduce measures for the election of judges.

Mr. John M. Taylor: The answer is no. The Government do not consider that elections would provide a suitable basis for appointment or be compatible with the principle of judicial independence.

Mr. Skinner: The Government did not say that about trade union leaders, who they said were out of touch with their members and should be subject to re-election every five years. How else can we make judges accountable, especially in the light of what they have said recently about rape cases and repetitive strain injury—

Dame Elaine Kellet-Bowman: Ask a question.

Mr. Skinner: I have already asked two questions.
It is high time that the Government introduced a system of accountability, but they will not do so because too many people in this place, especially those on the Tory Benches, are part and parcel of the judiciary—barristers, solicitors and all the rest of them. That is the real reason why the Government do not want accountability.

Mr. Taylor: The hon. Gentleman may be surprised to find that I have an answer that may half oblige him—

Mr. Skinner: Let us hear it then.

Mr. Taylor: I am about to give the answer. The Royal Commission has considered the appraisal of judges and its recommendations will be deliberated upon. That represents some new thinking, which I believe will be welcome on both sides of the Chamber.

Mr. Jessel: If we are to avoid the election of judges, is not the corollary that judges must show that they broadly respect both public policy and public opinion? Is it not unhelpful when two such leading figures as the Lord Chief Justice and the Master of the Rolls are in open disagreement about what the law should be? Should not the Lord Chancellor ask them to desist from such pronouncements?

Mr. Taylor: There are conventions in the House about commenting on judges and what judges may say. Hon. Members may feel that this is an occasion on which to make such comments, but I am not sure that a member of the Executive should intrude into a matter of judicial independence.

Mr. Boateng: While the Minister and his Department have responsibility for the appointment of judges, and at a time of record levels of public concern about crime and the commission or criminal offences, is it not worrying that one day last months 24 courts in the south-east of England were closed for want of work? At the same time, on one day at the beginning of last month at the Snaresbrook crown court, offences of conspiracy to supply heroin and cocaine and offences involving arson with intent to endanger life were not heard because of a shortage of judges—there being insufficient money to pay for recorders or assistant recorders. Is not the Minister's Department presiding over a rather bizarre position, and what does he intend to do about it?

Mr. Taylor: It is not true that Crown courts are standing idle, although some sittings have been reduced to reflect the downturn in receipts for trial. Sittings will be restored later in the year if receipts increase. Sitting days have been reduced by only 2 per cent. compared with last year, despite a reduction in receipts of more than 15 per cent. in the first quarter of this year.

Freemasonry

Mr. Mullin: To ask the Parliamentary Secretary, Lord Chancellor's Department what plans he has to make freemasonry a publicly declarable interest for members of the judiciary; and if he will make a statement.

Mr. John M. Taylor: The Lord Chancellor has no plans to make freemasonry a publicly declarable interest for members of the judiciary.

Mr. Mullin: Does the Minister agree that there is nothing more corrosive of public confidence in the judiciary than the knowledge that many judges and magistrates are members of a secret society, one of whose aims is mutual self-advancement?

Mr. Taylor: I have answered a similar question from the hon. Gentleman in the past. The critical thing about the judge's appointment is that he takes a judicial oath. [HON. MEMBERS: "Or she."] I beg the House's pardon—or she.
The judge takes a judicial oath which binds him to consider any interest that he may have, to observe whether it could conflict with any matter before him and to excuse himself from the bench if he considers that there is such a conflict of interest.

Petty Sessional Divisions

Mr. Roger Evans: To ask the Parliamentary Secretary, Lord Chancellor's Department what criteria are being adopted for the amalgamation of petty sessional divisions; and if he will make a statement.

Mr. John M. Taylor: The optimum size of a division would be one that permitted an average annual attendance for magistrates of between 35 and 40 sittings.

Mr. Evans: Will my hon. Friend reconsider his reply and emphasise much more significantly the importance of providing local courts for the convenience of local witnesses and local parties? The insistence on a certain number of sittings is a criterion which ignores the factor of convenience to the public.

Mr. Taylor: The proposals that the Lord Chancellor has made are so far indicative only. Consultation will follow if a local view emerges which is held to be an improvement. I share with my hon. Friend, however, the opinion that the criteria for amalgamating petty sessional divisions are different from the criteria for the amalgamation of magistrates courts committee areas. He asked about the former and my earlier reply was about that.

European Council (Special Meeting)

The Prime Minister (Mr. John Major): With permission, I shall make a statement about the special meeting of the European Council in Brussels on 29 October, which I attended with my right hon. Friend the Foreign Secretary, and also about my separate meeting in Brussels with the Irish Prime Minister. The documents issued by the European Council and the joint statement that I issued with the Taoiseach have both been placed in the Library of the House.
Agreement was reached at the European Council on a number of important points. It was decided that, later this month, Finance Ministers would consider a draft White Paper by the European Commission, setting out proposals on growth, competitiveness and employment. The United Kingdom has already put forward suggestions for that White Paper. The European Council renewed its commitment to secure a global commitment in the Uruguay round before the December deadline. The Council agreed to provide extra help to small and medium-sized businesses by widening the criteria for loans by the European investment bank.
The future location of a number of European Community institutions was decided. Some of those decisions were long overdue. Of the main institutions, it was agreed that the headquarters of the European Monetary Institute will be in Germany, the European Medicines Evaluation Agency in the United Kingdom, Europol in the Netherlands and the Trade Marks Office in Spain. The decision on the European Medicines Evaluation Agency should reinforce Britain's position as the centre of the European pharmaceutical industry.
On Bosnia, the Council agreed to try to improve access for aid supplies as winter approaches. We are seeking credible assurances from the warring factions that they will not block access routes. The Council is also looking for more funding and troop contributions from outside the European Community, to supplement the huge efforts made, in particular, by Britain and by France. Work on the further Yugoslavia was identified as one possible area for joint action in foreign policy. The European Council also asked Foreign Ministers to consider joint action in support of the middle east peace process and to contribute to election monitoring by the United Nations in South Africa and in Russia.
Under the interior and justice pillar, the Council asked Ministers to bring forward proposals for co-operation in the fight against international crime and drugs, and over asylum and immigration problems. We agreed that the Europol drugs unit should be up and running within 12 months.
No one at the council was in any doubt that our highest priority is to restore sustainable, non-inflationary growth and to increase employment across the Community. I argued that the European Community had to confront its own structural weaknesses, which had led to a falling share of world markets and, by comparison with the OECD average, the loss of an estimated 9 million jobs since 1980. The quickest boost to growth and employment will be to secure a GATT agreement. It was also generally agreed that the Community needed to make its labour markets

more flexible, to cut red tape nationally and in Brussels, to encourage investment and to create the right climate for new and growing businesses.
I believe that economic convergence is a helpful objective for each Community member state. It will assist in keeping inflation and interest rates as low as possible, as well as controlling public borrowing and debt.
In our discussions, I again made clear that I considered the timetable for economic and monetary union stage 3 —a stage to which we are, of course, not committed—to be unrealistic. Public opinion and the recession have changed attitudes within the Community. Subsidiarity, for example, now has very strong support. During the past two years, the European Commission has halved the number of proposals that it has brought forward for new Community rules and regulations. In December, we shall be looking for specific proposals to cut back existing European Community law. There is increasing emphasis on inter-governmental co-operation, with decisions taken by consensus on both foreign and home affairs. We operate by agreement and not only through the treaty of Rome and the European Commission.
The European Council concerned to respond to criticisms that arose throughout Europe during the debate on the Maastricht treaty.
The Council declared:
We wish to introduce greater transparency, openness and decentralisation in our procedures. We want a Europe close to the citizen and intervening only where necessary to pursue our common interests.
We have argued long and hard for that approach within the Community, and I thoroughly welcome it.
Following the European Concil meeting, I had a bilateral discussion with the Irish Prime Minister. Mr. Reynolds gave me an account of the report given to him by the hon. Member for Foyle (Mr. Hume), together with the assessment that the Irish Government have made in the light of it. He did not pass the report itself to me. We acknowledged the courageous efforts made by the hon. Member for Foyle, but agreed that the report could not in itself be a basis for action.
We agreed that the two Governments should continue to work together on the following basis: Northern Ireland's situation should never be changed by violence or the threat of violence; any settlement must depend on consent, freely given; negotiations on a settlement could only involve constitutional politicians; there could be no secret agreement or understanding between Governments or organisations supporting violence as a price for its cessation; and those claiming a serious interest in advancing the cause of peace in Ireland should renounce the use of, or support for, violence. If and when such a renunciation of violence had been made, and had been sufficiently demonstrated, new doors could open, and both Governments would wish to respond to the new situation which would then arise.
The terrible events in Northern Ireland since our meeting last Friday have further underlined the urgent need for that process to succeed. As the House will know, last Saturday evening, two gunmen fired indiscriminately in a crowded bar in Greysteel, County Londonderry. Seven people died, ranging in age from 19 to 81, and 11 more were injured. A claim of responsibility for that appalling act was subsequently made by the Ulster Freedom Fighters.
The Royal Ulster Constabulary, who acted with exemplary speed and skill, have arrested nine people in connection with the attack. That, like the Shankill road bombing and the six other terrorist murders in Northern Ireland last week, was a barbarous and despicable attack on innocent and peaceful civilians. The whole House will wish to extend its profound sympathy to the victims' families and friends.
Less than 24 hours later, an RUC officer was shot and critically injured in Newry. That once again reminds us of the enormous debt that we owe to the brave men and women of that force.
Those murders will bring the terrorists no advantage, but only the prospect of long years in prison. Terrorism will not alter the constitutional guarantee that we have given the people of Northern Ireland. It will not defeat the security forces, and it will not deflect us from the search for a fair and lasting peace.
The joint statement with the Irish Prime Minister provides a clear basis for progress. Both Governments are committed to the talks process. The principle of consent must be at the heart of any settlement—as the Irish Deputy Prime Minister made clear last week, when he acknowledged the rights of Unionists to give or to withhold that consent. That clearly points to constitutional reform in the Irish Republic at the right time and in the right circumstances.
The Government will now intensify their efforts to find a basis for the constitutional parties in Northern Ireland to carry on the talks progress. My right hon. and learned Friend the Secretary of State for Northern Ireland will hold further discussions with the Irish Deputy Prime Minister in a meeting at the Intergovernmental Conference later this week. We are determined to do all that we can to bring peace to Northern Ireland. The further killings that occurred over the weekend make that search for peace all the more urgent.

Mr. John Smith: I thank the right hon. Gentleman for making a statement on both aspects. I welcome the European Council's confirmation of the enlargement timetable for Austria, Finland, Norway and Sweden so that negotiations are completed by March 1994 and accession by 1 January 1995. I welcome also the commitment to achieving within the timetable a successful conclusion to the GATT talks, and the initiative proposed for closer police co-operation under Europol.
As to the economic aspect, given the depressing realities of the economic situation in the Community, with 17 million unemployed, and with any recovery in Britain at best patchy and fragile, why is there not a greater sense of urgency on the part of the United Kingdom Government and other member states in taking more effective action to stimulate their economies and to bring down unemployment?
With the Bundesbank having begun to reduce its interest rates, is there not a strong case for co-ordinating interest rates cuts across the Community—not least in this country, where manufacturing output has fallen and the construction industry remains dangerously weak? Although we welcome the modest extra help to small and medium-sized businesses that was promised at the European Council meeting, can the Prime Minister explain why initiatives agreed as long ago as last year's Edinburgh summit have not yet been acted upon?
The right hon. Gentleman will recall that it was agreed at that summit to establish a European investment fund in addition to the increased facilities available through the European investment bank. He will be aware also that, for the European investment bank to establish the new fund, it will be necessary to amend the new protocol to the treaty of Rome. Can the Prime Minister explain why, nearly one year after the Edinburgh summit, that has not been done by the United Kingdom and other member states? Will he give the House an undertaking that there will be no more delay in pursuing an initiative for which he claimed credit at Edinburgh?
Will the Prime Minister explain why his Government are denying to areas of high unemployment and industrial decline in the United Kingdom more than £300 million of European funding because of spending restrictions on local authorities—an approach which is locking this country out of desperately needed investment funds? Will the right hon. Gentleman explain why, when his policy was to have Britain at the heart of Europe, the European Monetary Institute is to be placed at the heart of Germany? How will he explain to the City of London that latest triumph of his negotiating skills? Perhaps it is a case of game, set and match to the Bundesbank.
On Bosnia, what evidence is there that the declaration will have any significant impact on Serbian and Croatian aggression? Why did the Council not insist on making effective United Nations Security Council resolution 824 on safe areas in Sarajevo and elsewhere in Bosnia? Will the airlift be significantly increased to provide desperately needed winter aid to the starving people of Bosnia?
I join the Prime Minister in condemning without reservation the atrocities committed by the so-called Ulster Freedom Fighters in Greysteel, County Londonderry. Let me also express our concern at the shooting of an RUC officer in Newry by the IRA. Does the right hon. Gentleman recognise that these latest outrages have increased the powerful feeling, in Great Britain as well as on both sides of the border in Ireland, that efforts to find a political way forward must be pursued with renewed intensity? Is it not abundantly clear that a cessation of the horrific violence is what is passionately desired by the overwhelming majority in both Great Britain and Ireland?
For our part, we would welcome an early resumption of the talks process. We believe that the elected representatives of the people of Northern Ireland have a moral obligation to return to the negotiating table without preconditions. Any resumption of the talks, however, should take place within the previous three-strand structure, and on the principle that nothing is agreed until everything is agreed.
However, while efforts to persuade the parties to return to the talks will proceed, the two Governments have a responsibility to the peoples of these islands to attempt to develop their own institutional framework for peace. I urge the Government to examine carefully the broad thrust of the six principles outlined by the Irish Deputy Prime Minister; they must accept, however, that those principles contain a fine balance between nationalist and Unionist aspirations, which should not be destroyed by their being treated selectively.
Opposition Members recognise the courageous and imaginative work undertaken by the hon. Member for Foyle (Mr. Hume). We also recognise the political and


personal risks that he has taken—not just recently, but over a long period—in an attempt to bring peace to the troubled situation.
May I suggest to the Prime Minister that, whatever progress is made in talks between the constitutional parties in Northern Ireland, the United Kingdom Government and the Government of the Republic must continue to consider ways forward, and not hesitate to develop proposals themselves which could be put to the other parties, The public in both Britain and Ireland are looking in the first instance to their Governments to make and sustain a new initiative for peace.

The Prime Minister: The right hon. and learned Gentleman touched on a large number of important points in my statement. I shall endeavour to respond to all his comments.
I am grateful to the right hon. and learned Gentleman for welcoming enlargement, for which there was strong support from all the Heads of Government at the European Community meeting. There was also support for a completion of the GATT talks by 15 December, police co-operation on Europol and the general efforts to deal with money laundering and organised crime.
As for the economic points that the right hon. and learned Gentleman made, 18 million people are indeed unemployed across the Community at present. It is estimated that that figure will reach 20 million as unemployment rises sharply, particularly in France and Spain, over the next 12 months. An urgent examination of the policies is indeed under way: that is precisely what the White Paper is doing. It will be considered by Finance Ministers in ECOFIN—the Economic and Finance Council—within the month, and then remitted to the Heads of Government for their meeting in Brussels on 9 December.
I think that there is scope for interest rate reductions in some countries in Europe; some have already been made. I said that when I spoke to the Heads of Government meeting on Friday last week. As for the initiative on the European investment fund, the right hon. and learned Gentleman is right to say that it needs legislative cover throughout the Community. Virtually no member state has yet completed the necessary legislative cover, but we shall be able to do so speedily. I look forward to support from the official Opposition when I present the legislation to the House. As for others, I cannot compel them to deal with it speedily, but I have told them in our discussions that I hope that they will be able to do so.
I assume that, in expressing concern about the £300 million, the right hon. and learned Gentleman is referring to European Community funds. We made it clear to the Commission that we expect European Community funds allocated to the United Kingdom to be taken up by the end of this calendar year—not the financial year.
The right hon. and learned Gentleman neglected to mention that many hundreds of jobs will come to London with the European Medicines Evaluation Agency, but I am sure that he will welcome the several hundred direct jobs and the large number of secondary jobs that will be created as a result of that institution coming here. The European Monetary Institute has gone to Germany. That was the

consensus among the Community, and since we are not committed to stage 3, it is unsurprising that the consensus was that it should go elsewhere.
The activities of the Opposition last year did not help our negotiating position. [Interruption.] We will take their attitude to Europe seriously when they cease to obstruct European legislation that they claim to be in favour of. They speak with one voice in Europe but another in the Lobby.
I turn now to the right hon. and learned Gentleman's comments on Bosnia. He has a touching faith in declarations. I am bound to say that he is not dealing with entirely civilised men in Bosnia who are seeking to block the humanitarian aid. We are seeking to open corridors to ensure that we shall be able to get the aid through this winter. That will involve a massive effort. The strain of the effort thus far has been taken by the British and the French. We hope that others will make a larger contribution, and that point was made forcefully in our discussions after the last day.
I can agree with many of the right hon. and learned Gentleman's points on Northern Ireland. Like him, I would welcome an early resumption of the talks under the three-strand process. I am less concerned about the format than the fact of the talks, but it is desirable to get the fact of the talks under way as soon as possible.
There is a great deal in the Tanaiste's six principles with which we can agree—not all of them, but they are a helpful contribution to the debate, and I am happy to acknowledge that that is most certainly so. We wish to work with people to ensure that the talks process is a success. The Government would be willing, if others would find it helpful, to bring forward proposals to provide focus and direction for new talks once they begin. It is a hopeful sign that there seems to be a greater willingness to return to talks. I hope that that willingness will become a reality.

Mr. Norman Lamont: Is the Prime Minister aware that many people had seen this Council as an opportunity for greater realism on the part of the European Community? Will the Prime Minister explain to the House, given the views that he expressed in The Economist, given the break-up of the exchange rate mechanism, and given the views that he has expressed this afternoon about the timetable for monetary union, what is the purpose in going forward with a European Monetary Institute on the timetable envisaged in Maastricht? What will the EMI do? Are we not in danger of being drawn into a further bout of fantasy by the European Community, from which we shall find it difficult to extricate ourselves?
Secondly, there will be support on both sides of the House for the Prime Minister's initiative on Northern Ireland, but may I ask him for the assurance that there is no question of an amnesty for terrorists and no question of any negotiation with anyone who has been involved in terrorism in the past?

Several hon. Members: rose—

Madam Speaker: Order. Before the Prime Minister responds, will he allow me to say that many hon. Members are seeking to ask questions? It will be impossible to call all of them unless questions are brisk and to the point, and answers equally so.

The Prime Minister: I shall deal with my right hon. Friend's second point first. There are no political prisoners anywhere in the United Kingdom, so the question of amnesties does not arise in any way.
On the European Monetary Institute, there is indeed much greater realism across the Community, as the declaration from which I quoted a few moments ago illustrates very clearly. As my right hon. Friend will know, stage 2 in no sense infringes our monetary sovereignty and, as he will also recall, stage 2, which was negotiated by myself and my right hon Friend, was included in the Maastricht treaty and in our domestic legislation, and that treaty and the domestic legislation require it to commence on 1 January.

Mr. Paddy Ashdown: It is a good thing that the Maastricht treaty is now at last in place, but it is, I regret, a bad thing that the Government, under the Prime Minister's leadership, have once again at this special Council led Europe in its retreat from its responsibilities in Bosnia a failure over which many lives will be lost and which will cause much misery in the coming winter.
On Northern Ireland, does the Prime Minister accept that, for whatever understandable reason, there has been a certain loss of political momentum following the breakdown of the cross-party talks a year ago? Does he agree that this is the moment when he and the Irish Taoiseach could take personal charge? I hope that his statement means that that is what they now intend to do.
Does the right hon. Gentleman also agree that the six principles outlined by Dick Spring offer not only an appropriate way forward but some reassurance for the Unionist cause, and that the most important thing that could be done now to give impetus to progress towards peace would be if those who represent the Unionist cause could find it possible to utter some welcome, however guarded and partial, for those principles?

The Prime Minister: I shall deal first with the right hon. Gentleman's remarks on Bosnia. I find his continuing criticism of what has been achieved by this country, our voluntary services and our troops in Bosnia to be contemptible, and I use the word advisedly. It is time that the right hon. Gentleman stopped grandstanding on this issue and learned some of the facts about Bosnia and the realities of what can be achieved.
On Northern Ireland, the Taoiseach and I certainly propose to take a very close interest in the development of these discussions. We are both committed to seeing a success and to doing everything that can realistically be done to bring an end to bloodshed and to bring peace to the people of Northern Ireland. I acknowledge again, as I did a few moments ago, the importance of the principles enunciated by the Irish Deputy Prime Minister a few days ago. They seem to suggest that, in the right circumstances, articles 2 and 3 can be repealed, or at least put to a referendum for repeal, in the Republic of Ireland. I think that that will be very reassuring and that it is a considerable contribution to the search for peace.

Mr. Peter Temple-Morris: Does my right hon. Friend accept that the horrors of Northern Ireland place an awesome responsibility on him, on the Government and, indeed, on us all? Does he also accept that a settlement, or at least agreement on progress towards a settlement, would be an achievement of historic proportions for him and for his right hon. Friends?

The Prime Minister: I am grateful to my hon. Friend. I think that no one underestimates in any way the difficulties that lie in the way of progress in the present situation, but I do not believe that anyone who has observed what has happened in Northern Ireland—not only in the past three weeks, horrific though that has been, but in recent years—can be remotely satisfied with the status quo. Nothing that can realistically be done to bring peace and progress should be left undone.

Mr. John Hume: rose—

Hon. Members: Hear, hear.

Mr. Hume: May I join the Prime Minister in condemning the horrific slaughter in Greysteel on Saturday evening of so many decent people? May I also say that it is an insult to the memory of the decent people of the Shankill road who were murdered the previous week to use their murder as a reason for murdering others? Let no one be under any illusion: in a divided society, solutions can never be brought about by any form of violence or coercion.
Given that that has been my position and that of my party for the past terrible 25 years, I say that it is the responsibility of all people—especially Governments—to do everything in their power to try to resolve the conflict and bring the violence to an end.
Given that I say that, and note that throughout those 25 years 20,000 troops and 12,000 armed policemen on our streets and stringent security laws have not brought that peace; given that I take the responsibility, which is indeed mine, in circumstances in which I saw a real opportunity —and I mean my words—for achieving a total cessation of violence, which I say is the best opportunity that I have seen in 20 years; and given that the Prime Minister describes me in his statement as courageous and imaginative, why has the right hon. Gentleman rejected my proposals before he has talked to me about them?

The Prime Minister: I think that millions will agree entirely with the hon. Gentleman's remarks about Greysteel and Shankill. Nothing can justify the sort of action that we saw in Greysteel. As I indicated over the weekend, revenge simply breeds revenge—each death leads to another death—and that is no way forward for Northern Ireland.
May I repeat what I said in the statement? I have a great deal of admiration for the persistence and the courage with which the hon. Gentleman has, through many years, pursued a settlement in Northern Ireland. I have not always agreed with the way in which he has pursued that end, but I have always admired his courage and his determination to do so.
I have to make a judgment as to whether the actions that are taken will lead to the consent throughout every aspect of the community that is the irrevocable necessity if one is to have a settlement that will endure for a long period. I listened very carefully to what the Taoiseach had to say. The hon. Gentleman and I met some time ago. I believe that the hon. Gentleman has asked to see me again. I confirm to the hon. Gentleman that I am happy to meet him and I look forward to doing so, and to meeting also the leaders of the other constitutional parties in Northern Ireland. My door to them is open for constructive help towards reaching a settlement, from whatever source—any democratic source—it may come.
But I had to make a judgment on whether I thought that the proposals reached by the hon. Gentleman, at this time, and in the fashion that he proposed them, would actually lead to progress and to a settlement. I reached the conclusion—after having been informed of them by the Taoiseach, as we said in our statement over the weekend —that that was not the right way to proceed, and for that reason I said earlier today that I believe the way forward is the way set out in the joint statement that the Taoiseach and I issued on Friday.

Rev. Ian Paisley: I should like to associate myself with what the hon. Member for Foyle (Mr. Hume) said in condemning without reservation all the murders that have been taking place in our land. There is no difference between the tears of Protestants and the tears of Roman Catholics. These murders come from hell and lead to hell and there can be no justification for them on any grounds whatever.
Is the Prime Minister aware that the people of Northern Ireland will be listening carefully to what he is saying today? As he said in his statement that the document resulting from the Hume-Adams talks, as they are called, was not delivered to him but that the Taoiseach made some comments upon it, can he tell the House and the people of Northern Ireland what detail of that document led him to reject it? This House and the people of Northern Ireland should know that.
May I also tell the right hon. Gentleman that many people in Northern Ireland are alarmed by the communiqué that was issued, especially point 5:
The Prime Minister and the Taoiseach agreed that any initiative can be taken only by the two governments"?
Can the right hon. Gentleman explain to the people of Northern Ireland what difference there is between that and joint sovereignty? Surely the Government, and the right hon. Gentleman as Prime Minister, are the only people who can take an initiative in the internal affairs of Northern Ireland.
The Prime Minister also told the House today that, when the time is ripe, there is going to be a change in the constitution of the South. The people of Northern Ireland will be asking the Prime Minister, now many more Shankill roads and Greysteels must we have to bring about the ripening of the time?

The Prime Minister: To an extent, the hon. Gentleman answered part of his own question in the second part of his question. We need a settlement that will last. I do not think that the hon. Member for Antrim, North (Rev. Ian Paisley), any more than I or any hon. Member, is simply looking for a short-term ceasefire. We are looking for a permanent cessation of violence. That is what we are seeking. That means that some of the action—for example, the action that will bring comfort in the North on articles 2 and 3 —must necessarily be taken by the Government of the Republic of Ireland and not by us. It is right that we should work together to see whether we can produce peace in Northern Ireland.
So far as the document is concerned, I reiterate that I have not read it. Having spoken to the Taoiseach, I am aware of the document's contents. As I said to the hon. Member for Foyle, I made the judgment, on the basis of

that, that I did not think that it would lead to consent across Ireland and should not therefore be proceeded with in the form in which it existed.

Mr. William Ross: The horrific assault at Greysteel in my constituency on Saturday night has rightly drawn down the universal condemnation of all right-thinking people in Northern Ireland and their public representatives. May I say to the Prime Minister that the people in the area were very glad to see the Secretary of State paying a visit there yesterday, He was very much welcomed.
That atrocious attack left seven people, most of whom were my constituents, dead. Does the Prime Minister understand that universal condemnation—welcome though that is—is not enough? Actions speak much louder than words. Did the Prime Minister therefore ask Mr. Reynolds to close down places like the Republican News Bureau in Dublin, from which all the statements by the IRA are issued?
Will the right hon. Gentleman now give the most careful attention to selective detention, to behead the terrorist organisations of their control and command structures? Before he starts that, will he read the excellent article that appeared in the Irish edition of The Sunday Times yesterday on that subject, which unfortunately was not printed in the British editions? That article will clarify everyone's thinking. Does the Prime Minister also agree that swift and vigorous action is now necessary to restore confidence and to get rid of the massive fear that exists throughout Northern Ireland?

The Prime Minister: The slaughter of the hon. Gentleman's constituents in Greysteel was unforgivable. I hope that he will understand and pass to his constituents the depth of sympathy that exists in this House and across the country for the people who suffered in that attack and for their families.
We are in constant contact with the Government of the Republic of Ireland about security matters. There have been substantial improvements in security co-operation and cross-border co-operation over recent years. That is a continuing programme. It is not something that is begun and ended. A whole range of matters are continually under discussion.
As for selective detention, I have noted the public debate on the arguments for and against internment. This is, of course, an option which remains open to the Government. It would not, I think, at the moment be appropriate for me to comment on the circumstances in which that option might necessarily be used. It is there, and I do not rule it out.

Sir James Kilfedder: I associate myself wholeheartedly with the political initative by the Prime Minister. With the Irish Republic's acceptance, if such be the case, that there can be no change in the constitutional position of Northern Ireland without the consent of the majority there, and the promised removal, if such be the case, of articles 2 and 3 of the Irish constitution, it would seem sensible and desirable that the talks between the constitutional parties should be resumed as soon as possible. Does my right hon. Friend agree that every public representative in Northern Ireland should now call upon the people unequivocally to support the security forces in their fight to defeat terrorism, which presents a bar to political progress?

The Prime Minister: I entirely agree with my hon. Friend upon that issue. The Taoiseach has indicated acceptance of the principle of consent in Northern Ireland on the constitutional guarantee, and the Deputy Prime Minister in Ireland, of course, has indicated the possibility of putting a referendum on articles 2 and 3 to the people in the Republic.
My hon. Friend is entirely right about the need for the security forces to have the complete support of the people and of the leaders in Northern Ireland. There must be within Northern Ireland people who have information about those who have taken part in terrorist activities over recent weeks. I would appeal to those people to come forward with that information. It requires an act of bravery to do so, but that bravery, if they do so today, may prevent more slaughter, mayhem, death and misery for other families at a later stage.

Mr. David. Winnick: Is it not rather disappointing, to say the least, that the reaction of many Unionist politicians over the weekend to the constructive proposals that were put forward by the Irish Foreign Minister was to dismiss them as simply blarney? If agreement could be reached between the two Governments which accepts, of course, that the majority of the people in Northern Ireland have a right to stay in the Union but also makes other proposals leading to power-sharing in the North, would the Prime Minister carefully consider having a referendum in the United Kingdom as a whole? Although there might be a referendum in the Republic, the people of the United Kingdom could have an opportunity of deciding on those proposals prior to any parliamentary approval. Would not that be one way forward to overcome any veto by politicians in the North?

The Prime Minister: I am not at all sure that it would be helpful to making progress to comment on every aspect of what the hon. Gentleman says, although I understand what compels him to say it.
Perhaps I could make this point, which is relevant to the position in Northern Ireland: for too long the concerns of many people in Northern Ireland have been dominated by fears—some rational, some irrational—at each extreme of debate. What I think we have to do, if we are to work with the constitutional leaders in Northern Ireland to provide a settlement, is to try to offer the guarantees and certainties that will ensure that the extreme views that are so often put do not carry favour with the majority of people in Northern Ireland.
Once those fears and uncertainties are put to rest, I believe that we will have a much better climate in which we can work with all the constitutional leaders in Northern Ireland and try to promote a settlement that will end the bloodshed. Therefore, the way ahead that we proposed is the right one, although I note the hon. Gentleman's comments.

Sir Teddy Taylor: Has any estimate been made of the expenditure involved in the many bodies that were set up at the Council meeting? Although I agree very much indeed with what the Prime Minister said about economic policy, does he accept that the best that we can now do in the House of Commons is to wish him well, observing that the European union requires that the broad outlines and guidance of economic policy will now be determined by the Council by majority vote under article 103, which applies to us as well as to other member states?

The Prime Minister: As my hon. Friend will know, those are guidelines, and they were negotiated by my right hon. Friend the Member for Kingston upon Thames (Mr. Lamont) and myself in the Maastricht negotiations some time ago. On the substantive matter of the European union, the European union gives rise to a good deal of misunderstanding among people. It simply consists of the so-called three pillars—the European Community plus the arrangements for intergovernmental co-operation—I emphasise the word "co-operation"—in foreign and home affairs. "Union" is a way of describing that three-pronged structure, and it is nothing more than that.
I cannot immediately give my hon. Friend, off the cuff, the costs of those new institutions. Many of the institutions were agreed in principle many years ago, and there has been a delay in establishing them until the matter of sites was concluded. My hon. Friend will agree, for example, to take but one illustration, that the advantage of establishing Europol, if it is successful in dealing with drugs and crime money, is expenditure that, for all the people of Europe, will be seen as well worth while.

Mr. Tony Benn: Is the Prime Minister aware that there will be great disappointment that he has rejected the proposals which my hon. Friend the Member for Foyle (Mr. Hume) has been discussing? Given that Mandela was convicted of terrorism and has just won a Nobel prize, that Arafat was once refused permission to enter America and has now entered into meaningful discussions with the Israeli Government, and that David Owen is in Yugoslavia talking with men associated with violence, is it not time to look at the proposal put forward by the Irish Government 25 years ago, that the United Nations might send a mediator who would be able to talk to everybody in Ireland? The Prime Minister's refusal to have talks with everybody is now an obstacle to a peaceful settlement.

The Prime Minister: The right hon. Gentleman's implication is that he would talk to men engaged in violence. That is not a position that I or the leaders of any of the constitutional parties in Northern Ireland hold. It may he the right hon. Gentleman's view, but in a democracy such as the United Kingdom, that is not the way to proceed.
The right hon. Gentleman speaks almost for himself—

Mr. Dennis Skinner: No.

The Prime Minister: Well, for himself and perhaps the hon. Member for Bolsover (Mr. Skinner)—not together a weighty crowd.
I respect and admire the efforts of the hon. Member for Foyle—I mean that; I am not saying it as a matter of form—but it is my view and that of the Irish Prime Minister that we cannot proceed with those proposals.

Sir Peter Hordern: As to the European Commission's White Paper on growth and unemployment, will my right hon. Friend confirm that the Government's opinion is that economic growth cannot be obtained by increasing public spending, still less by raising taxes? Will he further confirm that the best way to achieve economic growth is to cut European bureaucracy and arrive at a successful conclusion of the Uruguay round? Will my right


hon. Friend say what success Mr. Delors and the Commission are having with the French on the latter matter?

The Prime Minister: There was complete agreement at the Council that we need a satisfactory settlement of the Uruguay round by 15 December. There was no suggestion by any participating state that that was not a desirable goal. I hope that progress is being made in dealing with the particular difficulties of agriculture in France. There are difficulties in concluding the Uruguay round with other countries beyond the European Community.
My right hon. Friend's points about economic development are entirely mine, and I would not wish to add to them. He makes the point that it is supply side changes that will lead to further growth and more jobs in Europe, not an excess of centrally funded expenditure.

Dr. Joe Hendron: I join all other hon. Members in condemning the massacre in Greysteel, and the UFF/UDA. I hope and pray that the young policeman shot by the Provisional IRA in Newry makes a speedy recovery.
Is the Prime Minister aware that, as long as murderers are stalking the streets of Northern Ireland, especially in west and north Belfast, people are living in terrible fear? It ill behoves anyone to criticise those who are trying to end murder. I do not wish to make political points about articles 2 and 3 or Select Committees; I am asking the House how we can end murder and slaughter on our streets. Of the 23 people murdered in the past eight days, 12 have come from the edge of west Belfast, the Shankhill road, or from the centre of my constituency, Kennedy way.
My friend and colleague the hon. Member for Foyle has made courageous efforts to try to end the violence and the existence of one of the killing machines. Bearing that in mind, will the Prime Minister use his close relationship with the Official Unionist party to persuade its Members of Parliament and colleagues in local government to speak directly to the UFF, the UDA and the Democratic Unionist party, to try to persuade them to end their terrible campaign of violence?

The Prime Minister: I have to say that I doubt whether the constitutional politicians of Northern Ireland have any authority over these murdering butchers. That is undoubtedly the case, whether those murdering butchers are members of the UFF or the IRA. We are dealing with people who are beyond the pale of civilised behaviour, and it does not lie within the remit of any hon. Member to be able to talk them out of their behaviour. I wish it were the case that hon. Members could, but events of recent years have shown that they cannot.
The hon. Gentleman may have implied that I was critical of his hon. Friend the Member for Foyle. As I said earlier, I am not, and I am happy to reiterate that. The fact that I have chosen, for the reasons that I have set out, to say that we cannot take his hon. Friend's proposals further in their present form does not imply a criticism of his hon. Friend's activities or his courage in recent years. I happily make that point plain again.
How are we to deal, asks the hon. Gentleman, with the fear that exists on the streets of west Belfast and elsewhere? The answer is to continue to give the fullest possible support to the security forces and the Royal Ulster

Constabulary. Against the sombre background of the murders committed in the past few days, we should not lose sight of the many achievements of the security forces in recent months. This year, some 50 people have been charged with murder or attempted murder, 3,600 kg of explosives have been recovered—more than twice as much as in the comparable period in the previous year—and 164 firearms and 42 rockets and mortar launchers have also been recovered. Many attempted attacks have also been prevented. Three such attempts have been intercepted in the past three weeks, and six people have been charged as a result.
The security forces are always in the light of public criticism when events of the type that we have seen in recent days occur, but we should also recall their many successes, not all of which can be made public.

Sir Michael Grylls: Does my right hon. Friend accept that most people in the country would recognise that he took exactly the right line at the European summit when he insisted on dealing with practical issues such as competitiveness rather than airy-fairy dreams for the next century? In that respect, would my right hon. Friend also agree that, since Britain and America have been far more successful in creating new jobs in recent years than continental Europe, he should continue to use his influence to press the other EC countries to lighten the burden on business—for example, by removing red tape, as he said earlier? That burden should be lifted particularly from small and medium-sized firms, because they will create the new jobs that we all want to see in Europe.

The Prime Minister: My hon. Friend is quite right. That is why we took the initiative to help small and medium-sized companies with extra resources from the European investment fund. It is a fact that, if the Community had been as successful in the past 14 years in creating jobs as other countries in the OECD have been, we might have 9 million fewer unemployed in the Community.
It is also the case that, in the past 20 years, the Community's relative share of world trade has reduced. Part of that reduction was entirely to be expected as countries in the Pacific basin in particular began to industrialise, but the loss in the share of world trade implies a significant lack of relative competitiveness. That is a problem that we need to address.
It is a striking statistic—one that I have used before, but it is worth repeating again—that, given the same growth in the past 20 years, the United States has created four jobs for every single job created throughout the European Community.

Mr. Dennis Canavan: Would the Prime Minister remind supporters of internment that its reintroduction would almost certainly be counterproductive, because the last time it was tried, it turned out to be an effective recruiting sergeant for the paramilitaries, and the violence went from bad to worse?
Does the Prime Minister agree that the best way in which to proceed in the quest for peace would be to invite all the interested parties to a constitutional conference and to make it absolutely clear, right at the outset, that, if a party or parties boycotted those talks, they would nevertheless proceed, with a view to finding a just and peaceful solution to end the appalling bloodshed?

The Prime Minister: I set out my views on internment a few moments ago, and I have nothing to add. There are many lessons to be learned from experiences on previous occasions. Simply to call a constitutional conference with great hopes built up for it and then to see it fail may not be the most practical way forward.
What is right, which is implicit in the hon. Gentleman's question, is that we should continue discussions to find the maximum amount of agreement that exists between the constitutional parties, and then focus on the areas of disagreement and see how we can eliminate them. That is the intention of the talks that are proceeding, whether one calls them an intergovernmental conference or a constitutional conference. What is sought from them is what the hon. Gentleman was seeking with his proposal.

Mr. Andrew Hunter: Continuing with the question of Northern Ireland, does my right hon. Friend agree that constitutional uncertainty has been and remains a breeding ground for terrorism in Northern Ireland? Does he further agree that Northern Ireland, de facto and de jure, is part of the United Kingdom because that is the democratically expressed wish of the people of Northern Ireland; and that, important though the search is for a political formula, it is equally important to assure the peole of Northern Ireland and of Great Britain who has experienced terrorist outrage that the security response is commensurate with the increased threat of terrorism?

The Prime Minister: We must certainly ensure that the security response is commensurate with the increase in terrorism, and we remain in close touch with the General Officer Commanding British forces and, of course, with the leaders of the Royal Ulster Constabulary. As chairman of the Back-Bench committee on Northern Ireland, my hon. Friend speaks with considerable authority of the difficulties that he sees in Northern Ireland. I confirm his observation that Northern Ireland is a part of the United Kingdom and that, under the constitutional guarantee, it will remain so until and unless a contrary view is taken by the people of Northern Ireland.

Mr. Jim Marshall: May I bring the Prime Minister back to the question of Northern Ireland and hope that I get an answer from him today? In answer to one question, the Prime Minister said that he still favours a three-strand approach. Does he accept the position that was adopted by predecessor some time ago —that there can be no agreement on any especial strand until there is agreement on all three?

The Prime Minister: The answer to that question is yes.

Mr. Patrick Nicholls: Would my right hon. Friend agree that, if the Government of the Republic of Ireland are as committed to war against the IRA as Her Majesty's Government, that offers an opportunity for the IRA and Sinn Fein to be proscribed in both countries, so that a proper military offensive can be conducted against them? Would not that mean that there would be no hiding place at all for them on the island of Ireland, and that, although it maybe a rather sombre assessment, it is likely to be more realistic than the courageous efforts by the hon. Member for Foyle, which would require us to sit at a bargaining table with terrorists?

The Prime Minister: We remain in close consultation with the security forces in the Republic of Ireland, and that will continue. It is improving all the time, and I expect it to continue to improve; I would not wish to go further than that on this occasion.

Ms Kate Hoey: I welcome the Prime Minister's call for constitutional parties in Northern Ireland to get round the table as quickly as possible. Does he agree that there is a huge democratic deficit in how we govern Northern Ireland at present, and that, while it is part of the United Kingdom, we should surely treat it in the same way as we treat other parts of the United Kingdom? Some hon. Members greatly support the setting up of a Select Committee on Northern Ireland. Did he discuss that with the Taoiseach? Did he have any views and if he did, what was the Prime Minister's response to his views?

The Prime Minister: I agree with a great deal of what the hon. Lady has said. I did not discuss the setting up of a Select Committee of this House with the Head of Government of the Republic of Ireland. That is a matter for the House. I certainly did not discuss it. It is a matter to be considered by the Procedure Committee. I understand that the Committee is examining it, and in due course, we shall consider any report that it may produce.
The hon. Lady is entirely right about a democratic deficit in Northern Ireland; there is a democratic deficit. It is precisely because we strongly share her views on that that we wish to make progress in the talks so that we can devolve a proper system of local government—an enhancement of democracy for local politicians in Northern Ireland.

Mr. Peter Bottomley: Does my right hon. Friend agree that the murderers need to be limited in their physical capability? It needs to be made clear to those on both sides that the violence and the killing will bring no advantage to them. It is important to go on working so that their supporters put pressure on them to reduce their capability. May I sum up by saying that each part of the community must protect the other just as much as it tries to protect itself? Is not that a welcome small silver lining in the ghastly cloud hanging over Northern Ireland?

The Prime Minister: It is. One of the horrific ironies of the murders in Greysteel the other day is that members of both the Protestant and Roman Catholic communities were murdered in the attack. My hon. Friend is entirely right about that.
On my hon. Friend's first point, I can give a categorical assurance that there is no way in which the continued murdering and killing by anyone, whether from the Protestant side or from the Catholic side, will affect the Government's policies and it will not gain anyone anything in terms of democratic advantage.

Mr. Skinner: Is not the Prime Minister aware that when he speaks to my right hon. Friend the Member for Chesterfield (Mr. Benn) about dealing with terrorists, the people outside Parliament understand only too well that the Government have dealt with terrorists over the decades? They are dealing now with the Chinese Government who were responsible for the massacre in Tiananmen square only a few years ago.
Will the Prime Minister understand that, if we are to follow the success of the Arafat-Rabin talks, we must have talks not in the Irish Republic or in Britain, but in a neutral


country? The way to get things off the ground is not to deal with the Conservative Government, who are in league with the Ulster Unionists who deliver them votes in the House of Commons, or with those in the Irish Republic, but to start the process in a neutral country. Such a policy resulted in success in the middle east, and that is the only way in which success can be achieved now.

The Prime Minister: As ever, the hon. Gentleman is very lucid, and as almost ever, he is entirely wrong. If the implication of his remarks is that we should sit down and talk with Mr. Adams and the Provisional IRA, I can say only that that would turn my stomach and those of most hon. Members; we will not do it. If and when there is a total ending of violence, and if and when that ending of violence is established for a significant time, we shall talk to all the constitutional parties that have people elected in their names. I will not talk to people who murder indiscriminately.

Mr. David Faber: In the course of his discussions on Bosnia, was my right hon. Friend able to bring to the attention of his European counterparts the remarks last week of the senior British officer in Bosnia, Brigadier Angus Ramsay, who described Croat soldiers as "scum"? Given the appalling atrocities that continue to be carried out by regular Croat army troops in Bosnia, was my right hon. Friend able to make any progress towards the long overdue sanctions against Croatia?

The Prime Minister: The question of further sanctions anywhere in the former Yugoslavia did not come up in the discussions. It did not come up in the discussions between the Heads of Government. To the best of my knowledge —unless I am corrected by my right hon. Friend the Foreign Secretary—the question did not come up in the parallel discussions at Foreign Minister level.

Mr. John Home Robertson: Everyone in Britain and in the island of Ireland desperately wants progress towards peace and a settlement in Northern Ireland. Is the Prime Minister aware that people find it difficult to understand why someone holding the office of Prime Minister in Britain is nit-picking about the proposals by my hon. Friend the Member for Foyle, which he apparently has not even seen yet? Can the right hon. Gentleman give an assurance that he will not allow his dependence on Ulster Unionist votes in the House to obstruct progress?

The Prime Minister: I would have thought that, even by the standards of the hon. Gentleman, that was rather cheap. Let me remind him that the position that I took on the initiative of the hon. Member for Foyle was taken also by the Taoiseach, who is not a Member of the House and is not dependent on the votes of any Member of the House. As I said earlier, there are no special agreements or deals with any other parties in the House. That has been stated by me and by others. The hon. Gentleman may smirk like a juvenile, but he falls well below the level of events with that sort of remark.

Mr. Ian Taylor: Does my right hon. Friend agree that we do not need to be defensive about the creation of the European union as of today, because it underlines the

fact that the progress in the Europe of tomorrow will be on an intergovernmental basis and not just on a better defined set of Community institutions?
Will my right hon. Friend put maximum emphasis also on the workings of the European Monetary Institute? Even if this country does not want to be part of a single currency, it is vital that we encourage the convergence criteria within the European Community so that we can benefit from the stability that will emerge. It is vital also that we underline the importance of the single market, because if that were ever questioned, through currency instability, jobs in this country would be at threat.

The Prime Minister: My hon. Friend is entirely right. Co-operation by consensus, by universal agreement across the Community, is a sensible way of progressing whenever it is appropriate. That is what happens under the three-pillared approach that was agreed in the Maastricht treaty. It is not a question of compulsion; it is a question of agreement. Where that agreement can be reached, we are stronger collectively and individually.
As far as the convergence criteria are concerned, they occasionally raise the hackles of some hon. Members, but the reality is that the convergence criteria are precisely the sort of sound economic policies that some of those who oppose them under the European label urge on me in other circumstances. The reality is that they are nothing more or nothing less than sound economic management.

Several hon. Members: rose—

Madam Speaker: Order. We must now move on.

Mr. Simon Hughes: On a point of order, Madam Speaker. Next weekend but one, the country will stop in its business for about two minutes to pay tribute to those who have died in two world wars, and will try to ensure that we as a nation learn the lessons of that.
The past hour has demonstrated the concern that is felt across the House for the people of Northern Ireland—across party, religion and denomination. I seek your guidance so that we can reflect the anger and solidarity, not only of Members of the House but of our constituents, who feel with and for their brothers and sisters on the other side of the Irish sea, on how we might appropriately show that.
There have been 3,000 people killed as a result of what has gone on in Northern Ireland: 2,000 were civilians; the remaining 1,000 were either in the police or armed forces. I do not think that there is a precedent, but I wonder whether you would permit, either between now and the end of today, or this week, the House to be adjourned or suspended for a moment or two to mark the universal disapproval of terrorism and of terrorists, and to reflect the cross-party resolve in the House, to try to see that no effort is spared to ensure that peace comes to Ireland as soon as possible?

Madam Speaker: I fully understand the hon. Gentleman's motives in putting his suggestions to me, and I appreciate the way that he put them.
There is undoubtedly complete disapproval in all sections of the House of what has taken place in Northern Ireland recently. Expressions of profound sympathy with the sufferings of Northern Ireland, and of concern for its future too, have been heard from every quarter of the House in recent days. As we have heard following the


statement today, those expressions have been reconfirmed by every Member whom I have called and who represents the varying points of view of the parties in the House.
Let there be no doubt that I share those sentiments—as I am sure does every hon. Member—as Speaker of the House of Commons, although I do not speak on those matters. We have recorded the sentiments that we feel about the happenings in Northern Ireland in recent days. I think that one of the best tributes that we can pay to the families there and to the people who have suffered is that we let those sentiments be known, as we have done today, and go on with our proceedings. I hope that hon. Members will support me in that.

Rev. Ian Paisley: On a point of order, Madam Speaker. On behalf of the people of Northern Ireland, I thank you for those remarks. They will be helpful to us all.

Madam Speaker: I am very touched by that.

Orders of the Day — Railways Bill

Lords amendments considered.

Clause 4

GENERAL DUTIES OF THE SECRETARY OF STATE AND THE REGULATOR

Lords amendment: No. 1, in page 4, line 46, at end insert—
("() The Secretary of State shall also be under a duty, in exercising the functions assigned or transferred to him under or by virtue of this Part, to promote the award of franchise agreements to companies in which qualifying railway employees have a substantial interest, "qualifying railway employees" meaning for this purpose persons who are or have been employed in an undertaking which provides or provided the services to which the franchise agreement in question relates at a time before those services begin to be provided under that franchise agreement.")

The Minister for Public Transport (Mr. Roger Freeman): I beg to move, That this House doth agree with the Lords in the said amendment.

Madam Speaker: With this it will be convenient to take Lords amendments Nos. 2 and 3.

Mr. John Heppell: On a point of order, Madam Speaker. I seek your guidance. During the passage of the Bill in Committee, 713 amendments and 32 new clauses were tabled. On report, we debated 252 amendments and 28 new clauses. We are now faced with another 470 Lords amendments and new clauses. Is there a parliamentary procedure to prevent the Government from tabling new amendments at this late stage and effectively changing their earlier promises?

Dr. John Marek: Further to that point of order, Madam Speaker. I am concerned about the matter. You must have seen the myriad amendments and new clauses that have been tabled. It makes me think that my service on the Standing Committee was a complete waste of time because we have a new Bill before us. Is there no way to send this botched job back to the Government draftsmen so that they can come up with something new that we can consider in detail, and in enough time? Effectively, we have a new Bill before us and only two days in which to consider it. It is a travesty of the rules of Parliament.

Madam Speaker: There is a great deal of responsibility on the Ministers whose task is to persuade the House to agree with the amendments. The ball is in their court.

Mr. Freeman: I hope that the House will find several of the groups of amendments that we shall be considering today and tomorrow relatively uncontroversial, although I recognise that some are controversial. My noble Friend the Minister for Aviation and Shipping gave detailed explanations of many of the amendments and I hope that the House will have had the chance, to the extent necessary and prudent, to study his remarks.

Mrs. Gwyneth Dunwoody: On a point of order, Mr. Deputy Speaker. I seek your guidance. I do not believe what my ears are hearing. Is it customary for hon. Members to recommend that other hon. Members take as read speeches made in the other place? Is it not normal parliamentary procedure for Ministers to take responsibility for their own speeches, to move their own amendments and to do the House the elementary courtesy of at least trying to explain what they have in mind?

Mr. Deputy Speaker (Mr. Michael Morris): Ministers must make their own judgments.

Mr. Freeman: I am just coming on to do that. I was trying, in a courteous manner, to refer to the proceedings in another place. I am only too delighted, as I had planned to do, to explain the purpose of the amendments.
Lords amendment No. 1 lays a duty on the Secretary of State in relation to part I. The hon. Member for Crewe and Nantwich (Mrs. Dunwoody), who participated in the Standing Committee, will remember that there were already provisions in the Bill, which we debated in Committee, dealing with the promotion of management-employee buy-out bids. The Bill was defective in not including such reference in part I. The amendment rectifies that. It does not introduce a new principle or policy. It makes the Bill clearer.
The amendment lays on the Secretary of State a duty clearly to promote the award of franchise to management-employee bids, and that is defined in the amendment. It refers to companies
in which qualifying railway employees have a substantial interest, 'qualifying railway employees' meaning for this-purpose persons who are or have been employed in an undertaking which provides or provided the services to which the franchise agreement in question relates at a time before those services began to be provided under that franchise agreement.
There is no clear definition—essentially, it will be a matter for the courts—of "a substantial interest". I shall not attempt to define that. The courts may wish to adjudicate upon the matter if a case comes before them.
The purpose of putting "a substantial interest" on the face of the Bill is to show that we wish to support British Rail management and employees who come together to take an interest—it does not have to be a 100 per cent. interest—in a company that bids for a franchise. Although the interest does not have to be 100 per cent., clearly, "a substantial interest" does not refer to a 5 per cent. interest. It is for the courts to determine, in the circumstances of a case, what is "substantial".

Mrs. Dunwoody: I am beginning to find this even more "Alice in Wonderland" than I had expected. Will the Minister accept that it is the responsibility of the House of Commons to frame legislation in such a way that it is clear and that House votes on it on the basis of its meaning? I have always had the rather old-fashioned view that Parliament is here to examine clear English, to understand what it means and to take decisions based on that. Will the Minister explain why he is seriously suggesting that the House should accept wording that is so unclear that he automatically expects it to be challenged in a court?

Mr. Freeman: The hon. Lady had time to table an appropriate amendment defining that in terms of 5, 10, 15 or 20 per cent.

Mrs. Dunwoody: I am not a Minister.

Mr. Freeman: The Government prefer this more general language. One has to decide, in the particular circumstances of the case, what "a substantial interest" means. In part, it will depend on the capitalisation of the company. It is not possible to legislate precisely in all circumstances. It depends in part on the debt burden. As those on the Opposition Front Bench will appreciate, in past bus privatisations, the amount of debt incurred by the management and employees varied considerably. The substantiaal debt burden incurred by some is still being repaid from the profits of the operation. It is not possible to be precise in every circumstance.

Mr. John Prescott: Is the Minister telling the House that if British Rail employees —managers or workers—want to combine in a joint bid with both private and public sectors, a judgment will have to be made about the size of the interest? Is he leaving the courts—rather than the House—to decide whether that will be 5, 10, 15, 20 or 50 per cent.? Taking into account the Government's other view—that British Rail will be allowed to make a bid for a franchise and could do so at a cheaper price than that being offered by the private sector—will that not encourage the private sector to get into bed with one or two employees so as to offer a cheaper price and make its bid seem like a British Rail bid?

Mr. Freeman: It might help if I explain that the Government have not reached any conclusions, or made any announcements, about any price reference to management-employee buy-out bids for franchises. The hon. Gentleman will recall that in Standing Committee I made it plain that our policy in relation to the outright sale of freight, whether train load or container business, was that it was appropriate for a small premium to be afforded to the management-employee bids, consistent with the preferences given in the sale of bus companies. That is normally expressed in terms of a discount.

Mr. Prescott: A cheaper price.

Mr. Freeman: Yes, but we are not applying that principle to the bidding for franchises. As I made clear in the Standing Committee, there is a distinction between franchises and bids for discrete businesses of British Rail which it will sell.

Mr. John McAllion: If the Minister looks at the wording of the amendment, he will see that a duty is imposed on the Secretary of State to promote the award of franchises to bids which involve former employees of British Rail. If the Government are to promote in that way, that must mean that some competitive advantage will be given to such a bid.
If the Government are doing that, why is it necessary for franchise bids only to have "a substantial interest"? It will be possible for a bid with only a minority interest of former BR employees to be given a competitive advantage. The Minister is not addressing that point. Has not the Minister recommended to the private sector that a bid representing the interest of 20 or 25 per cent. of former employees of British Rail will have a competitive advantage over every other bid for franchises?

Mr. Freeman: We are not discussing the process for the bidding for franchises. The hon. Gentleman knows that that subject will be dealt with in the debate on a grouping


of amendments in due course. We are talking about a general duty that is placed on the Secretary of State to promote management and employee buy outs—

Hon. Members: That is the point.

Mr. Peter Snape: Perhaps I could help the Minister.

Mr. Freeman: I am well capable of helping myself, thank you very much.

Mr. Prescott: It does not seem so.

Mr. Freeman: Perhaps I could explain. I have dealt with the price preference, but there is another way in which management and employee bids can be assisted. That is in terms of the financial assistance which is to be provided by British Rail, and which is limited to a sum of £100,000 in each particular management and employee bidding group, in preparing for bidding for franchises. That is a clear example, and I am not talking about the price preference in the context of the 5 per cent. discount that has been applied in the past for bids for bus companies.

Mr. Snape: The Minister seems to be floundering—that is unusual for the hon. Gentleman—on the clear piece of legislation contained in the clause.
I wish to raise a point similar to that raised by my hon. Friend the Member for Dundee, East (Mr. McAllion). Surely at such an early stage of the proceedings it would be helpful to know what criteria—financial or otherwise—railway managers are expected to follow before they mortgage their homes. Is not this the right place and time to debate that subject?

Mr. Freeman: I hope that the hon. Gentleman will raise that matter during his speech, at which time I will seek to answer it.
I know that the hon. Gentleman has experience of the process because he has been associated with a distinguished management and employee bid in the bus industry. I congratulate West Midlands Travel and appreciate the supporting role that the hon. Gentleman has been playing since the company entered the private sector. I do not wish to score party political points here, but the company is owned by its management and employees. It is successful, and I am pleased that the former employees of the company own shares in it. The hon. Gentleman and I visited the company recently and I am glad to applaud the company, its management and its employees.
There is no question of the management and employees of British Rail having to enter into second, third or Fourth mortgages to raise money to bid for franchises. That is wholly out of the question. We are talking about the management and staff of British Rail joining to bid for franchises, either by themselves or in conjunction with other private sector companies. Those companies might be financial institutions or operating companies.
We want that to happen, and there is real evidence of interest among the 25 potential franchise companies. I have spoken to a number of managers and I can confirm that senior management responsible for running train services within British Rail are interested in proceeding. We shall see how many of them offer bids when we come to the franchising process, but the Secretary of State will have a duty under the amendment to promote that interest. I have given a clear example of the way in which my right hon. Friend intends to do so.

Mr. John Gunnell: The Minister referred to a management buy-out in the West midlands. He will be aware that I was involved in a similar buy-out in West Yorkshire.
There is a great difference between those buy-outs and what the Minister is dealing with in this case. In the cases of the bus companies, the buy-outs involved existing and functioning companies, the value of which could be ascertained; finance could then be put together on the basis of management who were motivated to move in that direction before it received any suggestions from outside. The buy-outs came from the innate motivation of the managers, who believed that that was way to ensure an integrated network in West Yorkshire.
The position is different if one has to encourage and prod people into undertaking management bids. Does the Minister agree that the motivation of managers and their drive to make a company successful will determine in part whether people will finance that company? I am concerned that—

Mr. Deputy Speaker: Order. The House is becoming concerned at the hon. Gentleman's lengthy intervention. He has made his point, and perhaps the Minister will now reply.

Mr. Freeman: It is a fundamental tenet of Conservative party policy that we wish to encourage the management and staff of any enterprise to take an equity interest in the running of that enterprise. That has worked well with the National Freight Corporation, with British Airways and with the bus industry. It is a fundamental tenet, and that is why we are putting it in the Bill.
It may be helpful if I briefly explain the financial structure of the franchises. I am not talking about a company that is bidding for a franchise with or without its management and employees having to bid sufficient sums to acquire or maintain the infrastructure. That is the responsibility of Railtrack.
I am not talking about the necessity to acquire rolling stock. We recognise that rolling stock—either second-hand or new—will have to be leased from the rolling stock leasing companies which we propose to establish. Franchising companies will need sufficient resources to meet the working capital requirement. In many cases, that will be a negative working capital requirement because of the prepayments of season tickets by commuters. There may be no need to raise capital simply for the working capital requirements of the business. It may be necessary to have lines of credit or financial resources which may have to be drawn upon if the business encounters either a fall in its revenues or an unforeseen increase in costs. Those are risks with which the private sector has experience of dealing. Therefore, although I do not anticipate that the management and employees will have to put up significant sums, they will be involved in the venture. They will need lines of credit or financial support from the City and elsewhere to bid for franchises.
Amendment No. 2 deals with the relationship between my right hon. Friend the Secretary of State—and future Secretaries of State—and the regulator. The amendment deals with a change in a provision in the original text of the Bill, where the regulator had to have regard to the financial position of Railtrack. The change which was proposed in


the Lords and which we are commending to the House deals with the regulator acting in a manner which will not render it unduly difficult to finance any activities.
The amendment strengthens the position of Railtrack vis a vis the regulator in a perfectly sensible fashion. It allows Railtrack to prosper, and ultimately we wish to see Railtrack move into the private sector, although we cannot forecast when that will happen. We want Railtrack to be able to manage its affairs in a sensible fashion and in accordance with the financial regime that has been laid down by the Secretary of State while it is subject to the regulator.
The way in which the regulator controls the activities of Railtrack is essentially through the access agreements, with which the regulator has to agree. The Government think that the amendment is sensible and that it provides sufficient air for Railtrack to breathe to ensure that it succeeds and prospers.
Those are the reasons behind the two amendments which I have addressed. Amendment No. 3 does not represent a change in policy and is technical. I commend the amendments to the House.

Mr. Brian Wilson: First, I must place on record our deep objection to the way in which the Bill has been handled right up to the eleventh hour. In two days we are supposed to deal with 109 pages and 470 Lords amendments. The Bill has been rewritten. Fundamental changes were made at the eleventh hour and fifty-ninth minute. Many of the assurances given by Ministers in Committee have been thrown overboard at the last moment in an effort to make the whole thing workable—a task in which Ministers have signally failed.
Seldom can a piece of legislation have been so thoroughly discredited before even reaching the statute book. Yesterday the final depths of farce were plumbed. We learned that the Department of Transport working party on restructuring British Rail had told Ministers that a £2 billion public service obligation grant will be required for next year. That is £1·15 billion more than for the current year, and it is just the first instalment in the cost of privatisation.
5 pm
At a time when everything worth while in our society is under threat and when the nation's economic plight is so dire that value added tax is to be added to the cost of domestic fuel, the Government are considering spending an extra £1·15 billion not on improving the railways but on financing the privatisation of the railways. As a result of that extra £1·15 billion, not one extra train will run, not one extra passenger will be carried and not one extra tonne of freight will be transferred from our roads. The phenomenal increase in the taxpayers' subsidy will not go towards developing our railways. It will go towards paying for the gargantuan additional costs inherent in rail fragmentation and privatisation.
The proposed level of grant referred to in the working party's document is far in excess of the grant that British Rail has ever been given. If British Rail were given an annual grant of £2 billion, no one would be talking about privatising the railways. We would be boasting, like our continental neighbours, about how good our state railway company is. But having cut the grant to British Rail by

23 per cent. in the current year, with all the resultant service cuts and fare increases, the Tories are preparing to increase the grant by 250 per cent. next year to put in place the structure for privatisation. That is not a transport policy. It is the politics of prejudice, which have characterised the whole shoddy operation.
We see the same approach in the first amendment before us today. The Minister in the Lords suggested that it was merely a technical amendment. The Minister here says that it does not change anything. But the amendment would not have been proposed if it did not change anything and was not intended to do so. It was specifically the first attempt at circumventing the Peyton-Marsh amendment. That amendment placed a duty on the franchise director to give preference to management buy-outs. As my hon. Friends have adduced, management buy-outs are a form of privatisation.
The record of many management buy-outs is different from the one cited by the Minister. The Medway Ports were a management buy-out. City Link was a management buy-out. But, of course, management buy-outs quickly become full privatisations. The Government merely say that preference will be given to private bids to take over parts of the railways.
I object strongly on behalf of the great majority of railway managers to the way in which their name has shamelessly been taken in vain by Ministers. Ministers have paraded the country telling everyone who would listen—many preferred not to—that the Government were doing everything for the railway managers, who were champing at the bit to become involved in management buy-outs. Under the regulations that the Government insisted on enforcing, those same railway managers are not allowed to answer back for themselves on pain of losing their employment with the railways. If one of them had stood up and said that railway managers were not keen to become involved in management buy-outs, he would have risked not only his career prospects but his job.
While railway managers have been constrained, Ministers have felt able to travel around the country falsely representing the views of the railway managers. Ministers took it to the ultimate extreme in dealing with their Back Benchers. They told Back Benchers that they could not allow British Rail to compete because railway managers wanted to compete. Last week we saw the first evidence of the truth of the matter in a survey of railway managers.
Under the protection of anonymity—which surely should not be required in a democratic society—81 per cent. of railway managers said that they were opposed to privatisation as outlined in the Railways Bill. When asked whether they were in favour of British Railways Board having the ability to bid for franchises, 68 per cent. said yes and 18 per cent. said no. When asked whether they were in favour of management buy-outs in preference to BR bidding, 20 per cent. said yes and 64 per cent. said no. When asked whether there was a conflict between management buy-outs and BR bids, 77 per cent. said yes and 6 per cent. said no.
So when, for the first time, the managers are asked, we find a majority of between three and four to one against everything that the Government are doing. Yet Ministers have shamelessly maintained outside this place the hypocrisy and untruth that the purpose of the legislation is to support the ambitions of railway managers.
Why do the Government always support minority vested interests? It would be astonishing if within the


whole railway network there were not a few managers who could be paraded in The Daily Telegraph—three, to be precise—and I believe that the same three were paraded last week at St. Ermine's hotel to tell Tory Back Benchers about the enthusiasm for management buy-outs among their colleagues. If railway managers were so in favour of management buy-outs, I should have thought that two different sets of three could have been found—one for St. Ermine's hotel and one for The Daily Telegraph. But not a bit of it—it was the same three.
I should be interested to know who paid those three railway managers while they sat in St. Ermine's hotel in a room booked by Coopers and Lybrand telling Tory Back Benchers what to do with their votes in the Division Lobby. Indeed, I am interested in the role of Coopers and Lybrand in rail privatisation as a whole. Why does Coopers and Lybrand book rooms at St. Ermine's hotel and fill them with railway managers, presumably in British Rail's time, in order to dragoon Tory Back Benchers into those rooms to be told what to do?
Coopers and Lybrand has a big role in all this. It has a big financial role. One of its directors, Sir Christopher Foster, is the Secretary of State's adviser on privatisation. While Coopers and Lybrand may be able to do some of the Government's dirty work a few yards away from here and book hotel rooms, it does not seem to be getting on so well with the substantive matters of railway privatisation. I do not know whether the Minister will tell me what Coopers and Lybrand is paid for its consultants' reports.
Coopers and Lybrand has come back twice to the Government to tell them that it cannot come up with access-charging regimes for the railways and that more work will have to be done. According to Modern Railways this month, Coopers and Lybrand has told the Government that the idea of railway leasing stock companies will not work. The Government can pay anyone to book a room in St. Ermine's hotel, but they are paying Coopers and Lybrand millions to tell them that the thing will not work and that the crucial solutions cannot be found. If the Minister can shed any light on the role of Coopers and Lybrand, Sir Christopher Foster and all the rest of the interlocking gang who are pushing privatisation through, the information will be received with interest and probably with surprise by the House.
Conservative Back Benchers can do what they like. I am sure that they will vote for all this nonsense. They will think that they have got themselves off the hook. The legislation was another own goal even before the historic compromise was reached: it had been discredited and the Government were a laughing stock because they were offering nothing. The amendment is part of that. Priority, preference and promotion will be given to private bids against any bids from British Rail. That is the easy bit. Legislating for that is easy. But management buy-outs or private companies with a token insert of management involvement will still have to raise the money.
We know—we do not need to have it explained in a little tutorial from the Minister—that companies will not take over the assets. We know that the Tory Government are setting up a raft of quangos to take over the assets. We know that the companies will take over management contracts for a limited period without any of the assets that provide security. We understand all that. But the companies will still have to raise the money in the markets to finance that operation.
I notice that the Secretary of State is sitting there dumb. I am reminded of something that I read yesterday when I was browsing through Lady Thatcher's memoirs—it is good for insomnia. I quote from page 835 under the heading, "Men in Lifeboats":
But I still wanted a new face at Education where John MacGregor's limitations as a public spokesman were costing us dear in an area of great importance.
If he was a failure at education, he is a disaster at transport. [Interruption.] I am sorry. Lady Thatcher has high opinions—

Mr. Stephen Day: Will the hon. Gentleman give way?

Mr. Wilson: No. Obviously, the Secretary of State for Transport has a great track record on popular policies. I quote from page 848 of Lady Thatcher's memoirs:
John MacGregor supported me: I could not now credibly promise a radical overhaul of the community charge, no matter how convenient it seemed.
He is back today and cannot promise an overhaul of rail privatisation, no matter how convenient or sensible it might seem, and no matter what a splendid precedent it might be.
Yesterday, he was confronted with questions. Suddenly, after so many months, we started to hear about 15-year franchises—such franchises entered the frame. It is policy on the hoof. The Government can provide 15-year, 30-year or 50-year franchises, and they can politically fix a subsidy to those franchises for a couple of years, but they will not be here to see them through. I make no idle boasts but there may or may not be a change of Government—that remains to be seen.
If anyone in the City puts money into the franchises on the assumption that this Government, for political reasons, can guarantee a level of subsidy and then guarantee the conditions of those franchises to those operations for more than 18 months or two years, much less three years, five years, 10 years or 15 years, they will be much mistaken. I would not put tuppence on it. I do not think that they will put much money on it because everyone realises that the Government will throw money at a small number of franchises to give them some political credibility this side of a general election. People will see through that because they will realise that, if it ever got beyond that stage, every bit of loading that went towards the few private franchisees would be at the expense of those operations that were still run by British Rail.
Labour Members speak for railway managers. We speak for the 80 per cent., not the 20 per cent. While 20 per cent. are being bribed into taking franchises with assurances that Ministers are in no position to give, 80 per cent. will still be running services in the public sector. We will not stand idly by and see them left with a rump railway stripped of investment and subsidy in order to skew financial support to those small elements that the Government have managed to get into the private sector.
"Preference" and "the promotion of management buy-outs" are double talk for saying that, in all the circumstances, British Rail will be discriminated against and anyone the Government can get to bid against British Rail will be preferred. That approach, which is inherent in this amendment, was confirmed by the deal done last week where it was formalised that if anyone bids, or anyone can be found to run a railway, British Rail will be disqualified from doing so.
I need hardly say that that is not acceptable to the Labour party. I said last week, and I say again, that if people buy the fact that silly Government Members paraded their consciences in the summer about their concern for the future of the railways and the right of British Rail to bid, electors and anyone who knows anything about the industry will judge the consistency or the principle that underlies that decision. We will oppose amendments Nos. 1 and 2.
The whole question of Railtrack's charges becomes extremely interesting in the context of the document entitled "Commercial Returns for Passenger Train Operating Companies", which states:
Roundly the central Government grant requirement would total some £2 billion in 1994–95 assuming an 8 per cent. return for Railtrack.
It is interesting to have confirmation that Ministers are working on a return of 8 per cent.

Mr. Freeman: indicated dissent.

Mr. Wilson: The Minister is welcome to intervene if he so wishes. The 8 per cent. return for Railtrack will come only through charges to the operating companies. That will be the source of income for Railtrack via the franchise director. As we all know, the subsidy to British Rail in the current year is about £830 million. Those are the two figures, like for like—£830 million and £2 billion. The hon. Member for Worcester (Mr. Luff) looks characteristically puzzled. I may be able to help him.

Mr. Peter Luff: My puzzlement relates to what the hon. Gentleman's speech has to do with the amendments under consideration.

Mr. Wilson: The hon. Gentleman's puzzlement speaks volumes about his comprehension. If he does not understand—

Mr. Matthew Banks: rose—

Mr. Wilson: Tory Members should hang on a second —I will listen to one at a time. Public schoolboys are so impetuous.
If the hon. Member for Worcester cannot read the amendments and find that they relate to the charging regime of Railtrack and management buy-outs, perhaps he needs a course in literacy rather than rail privatisation.

Mr. Banks: If the hon. Gentleman spent more time doing his homework not simply on the railways but in every respect, he would know that neither my hon. Friend the Member for Worcester (Mr. Luff) nor I went to a public school. Throughout this debate, I hope that the hon. Gentleman will spend more time concentrating on the amendments and less time on the invective. I have always felt that he makes much better contributions, which are listened to with greater interest on both sides of the House, when he is less personal and concentrates on the matter in hand.

Mr. Wilson: I am so impersonal I have forgotten the hon. Gentleman's name.
We have come to the end of a long process. We had reasonable debates in Committee, and we won assurances there. However, we have seen those assurances overturned

in the other place. We have come to the last lap in the parliamentary process and we are confronted with an additional 470 amendments. Railway pensioners have written to us to express their concerns, but those concerns have been ignored.
Frankly, I am much less concerned about abuse towards Government Members than I am about the abuse of Ministers towards the railway network, railway pensioners and so on. If Conservative Members expect a soft ride and a nice little game of cricket, they will not get it. This privatisation is not like other privatisations because the difficulties do not end here—they begin here. All around the country, we will continue to tell people what the Government have done to the railways. We will identify stage by stage the consequences of the legislation and we will hold to personal and electoral account those who voted for it in the full knowledge of precisely what they were doing to the railways.

Sir David Mitchell: rose—

Mr. Wilson: Does the hon. Gentleman wish to intervene?

Sir David Mitchell: I simply join my colleagues in expressing the hope that the hon. Gentleman might turn his attention to the amendments.

Mr. Deputy Speaker: Order. The amendments relate to the general duties of the Secretary of State and the regulator. There has been nothing out of order to date.

Mr. Wilson: If I were in trouble, I do not think that I would like the hon. Members for Worcester, for Southport (Mr. Banks) and for Hampshire, North-West (Sir D. Mitchell) as my cavalry. Many of my hon. Friends wish to participate in this key debate.
What we have here is a set-up. I wonder whether any Conservative Members took the trouble to fight to get a copy of the report. It is not a two-bit report from a junior civil servant; it is a report from a top working party—the good and the great of the Department of Transport putting their collective intellect into how this will work.
I can provide copies of this paper to any Conservative Member who wants to know what he is voting for. It roundly says that the Government grant requirement will total some £2 billion in 1994–95, assuming an 8 per cent. return for Railtrack. Everyone will pay everyone else 8 per cent., and so that the train operating companies can pay the leasing companies and Railtrack the economic costs plus 8 per cent., £2 billion will be needed next year to start the circle. That compares with £830 million this year.
I hope that I have demonstrated that I am happy to take interventions and will be pleased to answer questions. The hon. Member for Lewes (Mr. Rathbone) was a great rebel in this matter, and by now I would have expected the hon. Gentleman and the ex-Transport Minister, the hon. Member for Hampshire, North-West, to be leaping to their feet to explain why it is a better deal for the taxpayer to pay £2 billion to restructure for privatisation than to pay £830 million to keep the BR network going. If any Conservative Member can explain that, I shall be pleased to allow him to intervene.
There is silence, because they do not know and do not care. They do not care how much it costs, or about the £2 billion for restructuring or the £25 million currently being


paid to consultants such as Coopers and Lybrand and the usual suspects who are trying to tell the Government how to make the plan work.
They do not care that the extra £2 billion next year to British Rail will not provide an extra train. All that they care about is the ideology of breaking the system up and selling it. That is how it is seen in the country. No doubt we shall return to these arguments in the debate.
I ask my hon. Friends to oppose Lords amendments Nos. 1 and 2. I again express shock at the fact that we shall have to vote on 470 amendments. We are in for a long night.

Sir Michael Grylls: I have not spoken on the Bill before. That confession is not especially relevant but my deeper confession is that I am filled with admiration for the Opposition. For 13 years companies have been privatised or commercialised, one after the other. Great monolithic nationalised industries which were pinned down by the Government and the Treasury were allowed to fly free and prosper and provide a better service for the public. After 13 years the Opposition are still bitterly opposed to that.
The hon. Member for Cunninghame, North (Mr. Wilson) gave me the impression that he was not greatly in favour of privatisation. I admire the fact that he can still say that because he has been proved wrong time and again. Today's issue of the Evening Standard has a front-page headline about British Telecom offering a better and better service to the public. I am using that as an analogy, and I hope that I am in order. British Telecom would never have offered such a service before it was privatised. It is offering it now because the monopoly has been broken, more competition has appeared, and BT has to offer a better service.
Many of my constituents daily use the railways, and it might be thought that I would have been nervous about privatisation because it might upset some of them. I have thought carefully about the Bill and about the railways, which I use. To put it mildly, the rail service is not that good, and almost anything would be an improvement. Our track record on freeing up monopolies and introducing competition over the past 13 years has been very successful.
I am prepared to stick out my neck and say that railway privatisation is good because it will introduce competition through franchises and because it will allow management buy-outs. The Opposition used to espouse a form of co-operative ownership, and that had some attractions. A management buy-out is at least half of that because it will free experienced people in the railways from the bureaucratic clutch of British Rail. They will be allowed to get money to run a railway and offer a franchise, and that must be good.

Mr. Keith Hill: The hon. Gentleman speaks about the breaking of monopolies and the development of competition. Is he aware that the Government's proposals will lead to the establishment of regional and local private monopolies for periods of six, seven and possibly 15 years? Some of us prefer public and publicly accountable monopolies to private monopolies of the sort proposed by the Government.

Sir Michael Grylls: I understand the hon. Gentleman's point and I accept that he is partly right. However, there will probably not be different franchises on all sets of

railway lines, so it would seem that there will not be competition. There may be competition on the north-east route to Scotland. Let us assume that the hon. Gentleman is right, and that only one franchisee will operate on that line. There will be competition between that line and an operator on another line. People may say about my hon. Friend the Member for Hampshire, North-West (Sir D. Mitchell), "His constituents have a fantastic line with a wonderful operator and we should try to encourage that operator to another line." Therefore, there will be competition by example.

Sir David Mitchell: Surely because of the private car and the considerable expansion of coach operators, especially on commuter routes, it is no longer true to say that railways have a monopoly. On the longer routes there is competition from the airlines. The hon. Member for Streatham (Mr. Hill), who raised this hare, is wrong.

Sir Michael Grylls: I was giving the hon. Gentleman the benefit of the doubt and trying to be as kind as possible while not deviating from the amendment.

Sir Paul Beresford: I shall be a little more vicious than my hon. Friend. Does he agree that the hon. Member for Streatham (Mr. Hill) is diametrically wrong? The whole point about franchising and contracting out is that they will give the client, British Rail, control of public accountability on behalf of the taxpayer. Currently there is no such accountability.

Sir Michael Grylls: My hon. Friend puts the point rather more firmly than I would have done. I rest on the truth of the interventions by both my hon. Friends who spoke with great clarity.
No hon. Member can escape the fact that competition, however it is done and however imperfect—and it is difficult to get perfect competition—is beneficial. We should aim for maximum competition, and I thank the Government for breaking the monopoly because it has always been illegal for anyone other than British Rail to operate a railway system. That is a big step. [Interruption.]
The Opposition should listen. Hon. Members are here for only one reason—to try to serve the public. We are not here for our own gratification. At the moment, the railway is a public service and we should try to ensure that it provides a better service.
I end where I started. The Opposition have experienced successful privatisation and commercialisation over the past 13 years, and they are still saying, "Oh no, it does not work." They are either blind or determined not to work for the good of their constituents or the wider public. We should encourage the Government to press ahead with franchising as quickly as possible in the interests of our constituents. Management buy-outs should be encouraged, and I am glad to see that referred to in the amendment.

Mr. Wilson: The hon. Gentleman is obviously a great expert on privatisation. Can he tell us of any other privatisation in which the industry concerned continues to depend for its profitability on the level of taxpayers' subsidy?

Sir Michael Grylls: The hon. Gentleman has asked a perfectly fair question and I shall answer it. We are aware that many of the railway routes will require continuing subsidies. The Government have not been doctrinaire and said that the subsidies will be wiped out overnight. It is in


the interests of the public that they continue. If the hon. Gentleman is saying that the rail network is a more difficult commercialisation—perhaps a better term than privatisation when applied to the railways—I agree with him. However, that does not mean that we should run away from it and that we should not be more flexible in the way that we handle it.
5.30 pm
The hon. Gentleman cannot deny that the railways will be better served by competition, by the breaking of the monopoly and by the provision of a service with a private enterprise ethos. The industry needs to get away from the dread hand of a huge, bureaucratic business, which can never ben changed from within. The culture is too deep to change it from within; it can only be changed from without. I remember Sir Ian MacGregor saying when he was at British Coal, that every decision made either by him or by those at levels below him was immediately reported to the then Department of Energy. A business cannot be run properly with continual interference from Government.
British Rail needs to be freed from the dread hand of Government and commercialisation and management buy-outs must be encouraged. The Government are to be congratulated and I wish them well with the amendments.

Mr. Nick Harvey: It is small wonder that, at this last stage in the progress of the Bill, we are considering measures to featherbed management and employee buy-outs. It is not that many months since the Secretary of State told us that he was holding back the floodgates of private sector interest until 1994. Now, with just two months until it is 1994, the floodgates are in danger of collapsing inwards for the lack of any water on the other side. The truth is that virtually no one is showing any interest in bidding. The whole madcap plan for privatisation is now dependent upon management and employee buy-outs. As the hon. Member for Cunninghame, North (Mr. Wilson) said, a recent survey shows that, even among those groups, there is precious little interest in bidding.
The Government are flogging a dead horse and this is their last chance to salvage anything from the project. Is it any surprise that management and employees are showing such a lack of interest? What is in it for them? They are being offered only short franchises and there are no assets against which to raise funds. There is no opportunity to build up any assets that they can sell on at the end of the franchise period. For them, it will just be a daily struggle to run the services.
Why should managers and employees want to carry the can when disasters, such as that at Clapham, happen? Why should they take on that burden of responsibility without any proper corporation behind them? They know the horrible truth about the running of the nation's railway services and trying to encourage them to take responsibility for that is, as has been said, like trying to sell ice to an eskimo. It is no wonder that they need the incentive of extra funds and a clear path in the bidding process, with British Rail being kept out of it.
In Committee, we discussed in some detail the principle that the teams running the shadow franchises should not then bid to take over those franchises. At that point in the saga, the Minister agreed with that. If the teams running the

shadow franchises then bid for them, in effect they will be determining the price that they will have to pay for those franchises, or the subsidy that they will receive to run them. I recall that there was bad feeling during the bus privatisation because teams of managers valued the bus services that they then proceeded to buy.
In considering the special measures proposed to help management and employee buy-outs, we must question what impact competition law will have. I cannot help but remember the whole sorry debacle of the British Aerospace takeover of Rover, when the European Commission found that there had been unacceptable sweeteners. There is a risk that the Commission will reach the same conclusion about these measures.
Only this weekend we heard how much more privatisation will cost than was originally suggested. The late Robert Adley, the predecessor to my hon. Friend the Member for Christchurch (Mrs. Maddock), coined the expression "poll tax on wheels" to describe the Bill. At the time, he was referring to its unpopularity, but it might have been a more apt comparison had he been referring to the horrible expense that the taxpayer will have to bear. Privatisation will end up costing at least what was suggested at the weekend and probably a great deal more.
The preparations within British Rail for the shadow franchises and the management buy-outs are already having a desperate effect on morale as people within the industry wonder whether they are part of the in crowd—part of any bid. The air of intrigue and suspicion is having a profound effect on the morale of railway workers and that will become worse as time goes on.

Sir Michael Grylls: If the hon. Gentleman is so opposed to the Bill, why has the Liberal Democrat-controlled county council on the Isle of Wight welcomed the opportunity for the private sector to bid for the Isle of Wight railway? Why does the hon. Gentleman take a different line?

Mr. Harvey: I have said nothing today, or previously, to suggest that there should not be any private sector bid for any railway service. The amendments that we are discussing relate to management and employee buy-outs, which the Government want to featherbed. They want to distort competition and to short-change the taxpayer. Taxpayers have been investing heavily in our railway network for many decades. When someone wants to take over the service—whether a management buy-out or a private sector business—the least that the taxpayers are entitled to is the satisfaction and certainty of knowing that the service will be better run and at a better price than under British Rail, the existing carrier. There is no reason why there should not be management and employee buy-outs; I am not suggesting that they should be prohibited. However, such bids should be able to stand on their own feet in their attempt to beat British Rail.
The truth is that, in the dying hours of the passage of this Bill, the Government have been driven to make policy off the cuff. That is behind the Secretary of State's reluctant admission at the weekend that franchises might be allowed to run for as long as 15 years. For many months, anyone considering taking on a franchise has told him that, because any investment in the railways takes so long to be repaid, potential bidders would be interested only if the


franchises ran for longer than originally proposed. Now, in their desperation to make some sense of the privatisation, the Government have had to agree to that.
The Government are absolutely determined to wipe British Rail off the map. The amendments are an attempt to load the dice in favour of any bidder trying to take services away from British Rail. By all means management and employee buy-outs should be allowed to bid, but they should stand on their own feet, win on price and win on service provision.

Mr. Keith Hill: Lords amendment No. 2, according to the Minister, will enable Railtrack to manage its affairs sensibly. It also modifies the powers of the regulator in his application of access agreements.
Splitting the railway network between operating companies and an infrastructure authority—Railtrack—is a fundamental aspect of the Government's proposals. The scheme was greeted with bewilderment by the international experts who appeared before the Transport Select Committee, and the Committee expressed great scepticism about it on operational grounds. It remains a matter of deep confusion, however, why the Government have resolutely refused to name Railtrack on the face of the Bill, or to describe its functions therein.
Why have the Government refused to include any reference to Railtrack? Why have they broken with all precedent in privatisation legislation and refused to name a successor organisation of such fundamental significance? Why did they take their resistance to naming Railtrack to the extent of voting down an amendment so to do in the House of Lords? Does not that confirm that enormous powers for the future organisation of the railway will be concentrated in the hands of the Secretary of State. In the words of the Select Committee report, it is
an indication of the sweeping powers contained in part II which enables the Secretary of State to restructure British Rail in the way he sees fit.
Will the Minister confirm, because Parliament, the public and potential operators have the right to know, that the absence of Railtrack from the Bill means that it will be possible for the regulator to approve franchises which combine control of both operations and infrastructure? Is that not the very definition of a network licence, which appears in amendment No. 2?
In other words, will the Minister confirm that it will be perfectly possible for, for example, Mr. Richard Branson, of a potential Virgin Rail, to enjoy sole ownership of the east coast main line—if he so wills and if he can afford it—for a period of several years in the not-too-distant future? Was not that the effect of amendment No. 163, passed in Standing Committee B in the House of Commons on 23 February 1993?
5.45 pm
The Minister owes it to the House to be frank about the matter, because it bears profoundly on the kind of railway service that the public are likely to experience in the future. It also bears profoundly on the future viability of Railtrack itself.
Are there not several other major question marks over the financial arrangements of Railtrack? One major question is about access charges. Will the Minister confirm that, with only five months to go before Railtrack assumes its responsibilities, there is still no agreement on a financial regime—in other words, that there is still no agreement about the rate of return that Railtrack is required to make

on its assets and that, as a consequence, there is still no agreement on the charges that it will want to impose on British Rail or on possible private operators?
Is it not an extraordinary state of affairs, when literally half the railway, less than half a year before it comes into operation, still does not know what its revenue costs or revenue charges will be? Does not that uncertainty compound the uncertainty about the investment that is likely to be available to Railtrack following the current Public Expenditure Survey Committee round?
The Minister was right when, in Committee, he deplored the tendency of Governments to treat railway infrastructure as an economic regulator. He said:
It is sometimes seen as the regulator. When public sector revenues are under pressure, investment projects are often postponed."—[Official Report, 11 February 1993; c. 52.]
Quite right too.
In contrast to that deplorable record, the Minister drew, at that time, a rosy picture of a long-term rolling programme of investment for railway infrastructure under the new Railtrack arrangements. It would help the House if the Minister could give us a guarantee that, following the Budget, there will be no cuts in investment for Railtrack. At the end of the day, it is not phoney deals or fancy franchises, but cash entering the system, upon which the future of the railway system depends.

Mr. McAllion: The hon. Member for Surrey, North-West (Sir M. Grylls) referred to Opposition Members repeatedly getting things wrong. The hon. Member for Christchurch (Mrs. Maddock) reminded him of the words of her predecessor, Mr. Robert Adley, that the proposals contained in the Bill were
the poll tax on wheels.
If ever a Government got anything wrong, it was the Conservative Government when they brought in the poll tax; and if ever a Government are going to get it wrong again, it is the Government when they force this measure through the House tonight and bring upon themselves the hatred and rejection of the British people, who do not support the measures in the Bill and especially do not support the break-up of the public service railway.
I listened to the Minister of Transport in Committee, and I was not over-impressed by his contribution. I thought that perhaps he would have improved, having been given the summer recess during which to recover, but he made a brief speech tonight in introducing the amendments which even he should be embarrassed about.
The Minister began by saying that amendments Nos. 1 and 2 were relatively uncontroversial, and then he ran right into a wall of controversy when he suggested that he should not make the arguments for them, because we could read them in the Hansard report of the House of Lords. As my hon. Friend the Member for West Bromwich, East (Mr. Snape) pointed out, that is no way for a Minister of the Crown to operate in the House of Commons. If he can argue the case for those amendments, as he does here, he should not refer hon. Members elsewhere.
The Minister went on to say that the amendments were to make things clearer, but he could not say clearly what "a substantial interest" meant. He could only say that it is not 5 per cent. We are all agreed about that. "A substantial interest" does not mean 5 per cent., but what does it mean? The Minister could not define it more specifically.
An annexe in a letter that the Minister circulated to my hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott) describes the different groups of amendments.


When describing amendments Nos. 1 and 2 the Minister says that employees providing the railway services to be franchised must have "a significant interest". Which is the correct phrase? Is it the "substantial interest" that is in the annexe which the Minister sent to my hon. Friend? Will the Minister tell us which phrase will appear on the statute book when the Bill finally becomes a statute?
There is a difference between "substantial" and "significant". "Substantial" suggests that perhaps we are describing a majority interest. The Minister was careful not to define it in those terms, but that is what I would take to be the meaning of "a substantial interest". What do other hon. Members believe the phrase "a substantial interest" means? One may receive 650 different interpretations of what "a substantial interest" might mean.
Let us remember that we are dealing with law that will go on to the statute book. We could not get a definition of a key term in an important amendment that will go into a Bill and, by my standards, that is no way for a Minister to try to get any legislation through the House. In fact, he went on to say that he could not define "a substantial interest" because it depends on the capitalisation; it depends on the debt burden; it depends on the possibility that the company that is set up will suffer a loss of revenue at some time in the future.
It also depends on the unforeseen rise in costs. One foreseen rise in costs that may be able to be taken into account are the track charges that will be levied by Railtrack, but, as my hon. Friend the Member for West Bromwich, East pointed out, neither the Government nor the Minister are prepared to tell anyone what those track charges may be, so we do not know what foreseen or unforeseen costs may arise.
That is an insane way for the House to behave when we are dealing with legislation. What happens when one of the franchises is awarded to a bid that comes from a management buy-out and someone contests that award on grounds of interpretation? Should one go to the regulator and ask him to define "a substantial interest", or should one go to the courts?
Let us suppose that the parties ask the courts to decide what Parliament meant by "a substantial interest". The courts would look at the Hansard record of the debate and would find out that no one in Parliament could define "a substantial interest". The Minister was not prepared to do so. He virtually told hon. Members that it is up to us to make up our own minds about what that phrase means before we vote on the amendment. What will the courts think of the House if that is the sad result of our debate, because the Minister and the Government do not know what they are doing in these amendments?
The phrase "a substantial interest" is not the only problem. We went on to ask the Minister what he meant by "promoting". We are placing a duty on the regulator and the Secretary of State to "promote" management buy-outs. The Minister says that that does not mean price preference, so we are clear about that. Funds will be made available to help in the preparation of management bids. I think that the Minister said that—he referred to the fact that £100,000 of taxpayers' money would be made available for potential management buy-outs.
If I were a private sector bidder considering a franchise, I would make sure that former British Rail employees

made up the required 6 per cent. Under the Minister's definition that is all that will be necessary to qualify for a £100,000 handout to prepare the franchise bid. That percentage interest will also place a duty on the Secretary of State and the regulator to promote the bid when compared with one with which no former British Rail employees are involved.
The whole thing is absolute nonsense. What will happen if there are two bids which in all other respects are equal, but one is a management buy-out? Will the Secretary of State and the regulator be obliged to give the management buy-out preference? What if a private sector bid is only marginally better than a management buy-out? Does "promoting" mean that the Secretary of State must still give preference to the management buy-out in those circumstances?
It is an insult for the Minister to come to the House in 1993 with those arguments and to expect the amendment to be carried with a majority. It is also an insult to those Conservative Members who have been getting kudos from their constituents throughout the summer by arguing that they will stand up to the privatisation of the railways. When the time has come, they are not taking part in the debate or complaining when the Minister tables such shoddy and slipshod amendments.
As a Scottish Member, I have a special interest in the debate, because ScotRail and the east coast main line will be two of the first franchises put out to tender. I am especially concerned because, at a time when the Scottish rail network is crying out for investment, the Government seem to have got their priorities completely wrong.
A recent report on transport links with Europe prepared for the Select Committee on Scottish Affairs identified an urgent need for a £750 million investment in track and rolling stock in Scotland. At such a time, it is wrong for the Government to proceed with a Bill that will promote management buy-outs and privatisation, change the structure of the railways, and put at risk safety and all the other things that are important to people in Scotland.
Time and again, hon. Members have referred to the stories at the weekend about the measure costing about £2 billion. We know that the original estimate for the public sector obligation grant for next year was £851 million, based on the assumption that the rail network would remain in the public sector. However, an influential interdepartmental Committee set up by the Minister and the Secretary of State is suggesting that, if privatisation goes ahead, the cost will be £2 billion.
Every hon. Member knows that there is an unprecedented squeeze on public expenditure. The Chancellor of the Exchequer has made it clear that his proposed limits for public spending next year will not, under any circumstances, be breached. We must believe the Chancellor of the Exchequer when he says that £851 million will be spent on the public sector obligation grant next year. We must believe that that figure will not be breached, but if so, where will the other £1 billion-plus come from? I suggest that it will not come from Government grants to any franchise holder next year. The people who win the franchises will be expected to make savings by cutting services, jobs and working conditions for railway staff. That is not merely my view but that of the people who work in the industry.
Only last week, representatives of the "Save Our Railways" campaign came here. A train started in Glasgow, went to Edinburgh and then down the east coast


main line, picking up protesters. They all said exactly the same. People in Scotland have complained about the collapse of morale in ScotRail, caused by the threat of privatisation and management buy-outs. The Government dismissed that complaint. Mr. Donnie Shannon, a chargehand at Queen Street station in Glasgow, said:
Privatisation isn't an answer. The railways require investment. Privatisation will threaten rural services and staff are particularly worried about their conditions under private ownership.
The protesters are not the only people to think like that. Tayside regional council is the transport authority for my constituency in Dundee and it has a strategy to try to persuade commuters to move from private to public transport. A key component is to encourage the use of our railways. A series of stations just outside Dundee—Broughty Ferry, Monifeith, Carnoustie and Arbroath—desperately need investment to upgrade the buildings, improve rolling stock and keep the fares down so that the service can compete with the cost of taking a private car into Dundee.
There is no hope of fulfilling that aim if the Secretary of State and the Government go ahead with their privatisation plans. There will not be sufficient investment, because the money will be directed elsewhere, to ensure the profitability of the franchises, whether they are management sector buy-outs or private sector bidders.
The same is true of the east coast main line. I said in Committee time and again that that line consists of two complementary services—an electrified core service, which runs between London and Edinburgh, and a non-electric, non-core service from London to Dundee, Aberdeen and Inverness. I am worried about what will happen to the non-core services if the line is taken over by the private sector.
I wrote to InterCity to explain my fears. Mr. Brian Burdsall, the director of the east coast main line, wrote back and assured me that, as long as InterCity remained in the public sector, it intended to maintain the present level of services to Aberdeen and Inverness, and that it regarded the non-core services as an integral part of the line. He went on:
Whether private sector bidders will comply with this particular train plan and whether this timetable will endure for the length of the Franchise it is impossible to say at this point in time. This will partly depend on profitability and the level of Track Access charges which the Government has not yet determined.
While the line remains in the public sector and has Government support, services to Dundee and Aberdeen can be guaranteed, but once it is taken over by the private sector—whoever wins the franchise—there will be no guarantee. If the service cannot be run at a profit, it will not be run at all. It is as simple as that.

Mr. John Home Robertson: Where is the hon. Member for Aberdeen, South (Mr. Robertson)?

Mr. McAllion: Where are the Conservative Members who represent Scotland? I see that the Under-Secretary of State for Scotland has slipped into the Chamber. It is nice to see that at least one Scottish Tory Member has taken an interest in the debate, even if he has to because he is the Minister with that responsibility.
Recently, Mr. Douglas Smart, the secretary of the Railway Development Society in Scotland, wrote to Scottish Members to tell them of his concerns about the

implications of rail privatisation in Scotland. He received a reply from the hon. and learned Member for Perth and Kinross (Sir N. Fairbairn), who said:
I regard the complications of privatisation of British Rail as insurmountable and I am inclined to vote against the matter or abstain.
I do not know whether the hon. and learned Gentleman had hoped that that answer would be kept anonymous—he is not in favour of allowing anonymity for certain other people in society.
However, the letter was published, and at least that hon. and learned Gentleman replied to Mr. Smart, whereas other Tory Members representing Scottish constituencies did not —and we do not know their intentions tonight.
If privatisation goes ahead and lines are taken out of the public sector to be run by management buy-out teams or whoever, only one factor will determine their survival—whether or not those lines can be run at a profit. There will be no consideration of service to the people of the east coast of Scotland. In those circumstances, I know how I shall vote on the amendments and on the Bill tonight. I shall vote against them. The people of Scotland will be watching to see how Government Members who represent Scottish constituences vote.

6 pm

Mr. Home Robertson: I am happy to follow my hon. Friend the Member for Dundee, East (Mr. McAllion), because I also represent an east Scotland constituency that depends on services provided by ScotRail and the east coast main line.
I was amazed by the speech of the hon. Member for Surrey, North-West (Sir M. Grylls), who presented the view of a true believer in rail privatisation. He said, rightly, that we should be predominantly concerned about the interests of our constituents, particularly those who rely on railway services. I hope that the hon. Gentleman's constituents will follow what happens to railway services in their part of the world. I fear greatly for the prospects of rail services in my part of Scotland. There is little doubt that the Bill will lead to poorer services and higher fares across the board.
Lords amendment No. 1 states that the Secretary of State shall have a duty to
promote the award of franchise agreements to companies in which qualifying railway employees have a substantial interest".
Those who study the Register of Members' Interests will know that I am sponsored by the Transport Salaried Staffs Association. Its members, who are British Rail managers, must be the kind of people to whom the Minister was referring when he expressed the hope that there would be massive participation in management buyout by rail staff.
I am grateful to the TSSA for informing me of the views expressed by those of its members who are senior British rail managers in the survey to which my hon. Friend the Member for Cunninghame, North (Mr. Wilson) referred. Ninety-two per cent. of senior managers replying were not in favour of rail privatisation as outlined in the Bill; 77 per cent. were in favour of British Rail retaining the ability to bid for franchises; 71 per cent. were not in favour of management buy-outs; and 85 per cent. felt that there was a conflict between management buy-outs and British Rail bids—and I believe that the majority of people want British Rail to bid for franchises.
British Rail's senior managers want no part of privatisation. They are more concerned about the future of the service.

Mr. Gary Waller: Does not the hon. Gentleman think that it is significant that one of British Rail's most senior managers, Chris Green, managing director of InterCity, is prepared to put his career at stake by moving to ScotRail? That displays a very different attitude among managers than that claimed by the hon. Gentleman. Mr. Green said:
The biggest difference in the end will be that we're going to have to be more inventive, attracting more customers through marketing initiatives against a backdrop of Treasury squeezes over the years.
At least Mr. Green recognises that, in the past, it was not Government handouts that were the key factor, but the dead hand of the Government and the Treasury, which prevented the railways—particularly in Scotland—from attracting more customers. He acknowledges that there is a different way of approaching the problem in future, and is prepared to move to Scotland to prove it.

Mr. Home Robertson: Chris Green moved to InterCity from ScotRail in the first place, and I am not surprised that he is baling out of InterCity when the Government are in the process of dismantling it.
The hon. Member for Surrey, North-West conjured up the wonderful spectacle of competition leading to processions of private operators laying on more and more services for the benefit of our constituents, but he gave it all away when, replying to an intervention by one of my hon. Friends, he acknowledged that all services would depend on subsidies for ever more. They will be big subsidies, as we know from leaks over the weekend.
The House may be interested to hear some of the responses by British Rail senior managers in the TSSA survey. Sadly, they must remain anonymous. One commented:
Rail privatisation is essentially unsafe, requiring people unskilled in railway businesses to have access to systems and equipment for which they have inadequate training.
Another said:
Political dogma is blind to practical reality.
One manager stated:
I totally oppose BR privatisation in any form and I, like most other BR managers, believe it will fail to provide any kind of service.
There were many more comments, but perhaps the most significant of the comments that were passed to me was:
Every success in your fight. We have been muzzled.
That is what the Government have done to the people who know about managing rail services. Right hon. and hon. Members are not supposed to be muzzled but are meant to protect the interests of their constituents—both those who work in the railway system and those who depend on rail services. Where are all those right hon. and hon. Members? Where is the hon. and learned Member for Perth and Kinross?

Mr. Matthew Banks: The hon. Gentleman quoted on the subject of safety someone whose identity and place of work is unknown to me. Does he accept that, throughout the whole process, the Government accepted each and every recommendation of the Health and Safety Executive?

Mr. Home Robertson: I am not persuaded that privatisation will ensure the retention of proper safety standards, and I do not believe any of the Government's assurances.

Mr. Hugh Bayley: My hon. Friend knows that Opposition Members tabled an amendment in Committee that sought to write into the Bill guarantees on each of the Health and Safety Executive's 37 recommendations to the Government. Is he aware that the Minister urged Conservative Members to defeat that amendment, so that it would not form part of the Bill?

Mr. Home Robertson: Nothing surprises me about the Government's cynical approach to this type of legislation. We know from bitter experience that they are prepared to sacrifice all manner of important principles in their drive for privatisation for the hell of it—and we see that today.
The presence in the Chamber of so few Government Members speaks volumes. I suspect that the vast majority of Conservative Members are thoroughly embarrassed by the Bill. Many of them led their constituents to believe that they would oppose the Bill. Where are those right hon. and hon. Members now? I hark back to the poll tax. Conservative Members failed to stop that lousy legislation reaching the statute book, and they ended up with a botched job that did them great damage. There is a serious danger that the same will happen again with the Bill.
The country is looking to Parliament to protect the interests of our constituents. It is our duty to do that, but I fear that the Tory majority in the House will let down the people of Britain again.

Mr. Snape: Listening to the Minister was like getting into a lift—or into an elevator, if one prefers the American name—that has muzak playing in the background. For the first three or four floors, it is relatively pleasant but as the lift continues to ascend, one realises that the guts of the music has been taken out and one is left listening to plink plonk. By the time that the lift gets anywhere near the top floor, one wants to rip out the speaker and jump on it. Putting violence aside in respect of the Minister, listening to him felt much the same. His voice was mellifluous enough but his speech was sadly lacking any any content. I do not believe that the Minister, in his heart of hearts, has any more faith in the Bill than any other right hon. or hon. Member. Indeed, although the few Conservative Back Benchers who are present profess to be in favour of it, I suspect that, in their heart of hearts, they do not believe in it either.
I listened with interest to the contribution of the hon. Member for Surrey, North-West (Sir M. Grylls). He said that he had not spoken on this subject for 14 years. One forbore to say that, by the time he sat down, one could well understand why; but his speech did not—let us say—hit the heights in comparison with other speeches that we have heard in this Chamber.
Anyone who believes that fragmenting the railway system in the way proposed by the Government—in particular, in two of the three amendments that we are discussing—will be good for safety and cohesion in the industry betrays his or her ignorance. It is a pitty that the hon. Member for Surrey, North-West left the Chamber after making his speech. We need go back only 70 years or so—a comparatively short time in railway history—to see what happened to the system when small private operators competed with each other: gradually, they all went under


financially, and in 1923 the railways were combined into groups of larger, still privately owned, geographical) based regional companies.
I have no wish to cause Conservative Members further distress; I fear that, in due course, the electroate will do that anyway. However, let us consider what happened to those large, geographically based, privately owned companies throughout the 1930s and the second world war, until nationalisation. It is clear that they were exceedingly unprofitable. Let me choose one at random: the London and North-Eastern railway paid no dividends to its shareholders between 1935 and 1940. After that, of course, the taxpayer took care of the outgoings because of the second world war.
The fragmentation of the industry that the Government propose—whether or not management buy-outs are involved—is likely to prove disastrous on safety grounds as well, as has already been mentioned. It is difficult to find any senior BR managers who are in favour of the proposals, whether or not they can be persuaded to lead management buy-outs.
Predictably, the hon. Member for Keighley (Mr. Waller) referred to an article in this morning's Daily Telegraph, in which Chris Green was presented as a leading supporter of the principle. Although I cannot speak for him, I would not have thought that to be the case. I know that he is widely respected by railway workers for the way in which he has performed successive difficult jobs, but those jobs have been done within a unified railway system, in which some senior managers are themselves responsible for safety matters.
What concerns many Opposition Members about the proposed management buy-outs is the fact that they will be commercially driven and commercially led. Senior managers responsible for signalling safety, for example, will have neither the inclination nor the resources to be caught up in MBOs—which may well be led by people who understand how to turn over a quick profit, especially with the subsidies that we are discussing, rather than by senior managers directly concerned with safety.
One extremely senior manager to speak out against the proposals was Mr. Peter Rayner, formerly regional movements officer of the former London midland region. He was responsible for all train movements in the region. After the Clapham disaster, he denounced the fragmentation of the railway industry on the grounds of its likely impact on railway safety. Soon afterwards, he was transferred from his post and given a job that had been specially created; he described it to me as involving something called psychometric testing. I do not envy Hansardthe task of transcribing that! It was clear that—as he put it himself—Mr. Rayner was a square peg in a round hole. Before long, he took early redundancy and left the railway industry. So much for railway managers' being allowed to speak freely about the damage that they expect to be done to their industry.
The hon. Member for Southport (Mr. Banks) said that the Government had given various assurances about safety. What assurances from the present Government can we believe or trust? They have given many assurances about other matters that we shall debate today and tomorrow, but those assurances do not appear to have satisfied many people.
6.15 pm
As my hon. Friend the Member for Streatham (Mr. Hill) suggested, financial matters lie at the heart of the amendments. I never thought that he and I would be in the Chamber bemoaning the fact that railway subsidies were to rise. For many years, we have pursued successive Ministers—successive Governments, indeed—on the subject of expenditure in the industry. The fact is that, as my hon. Friend points out, the increased subsidy will not provide a single extra service, a single refurbished railway station or a single extra member of staff at a country station. The money will be used—purely in the short term —to bribe people to become involved in purchasing a franchise to operate a railway service.
Will anyone seriously wish to put up a considerable sum, whether it is their own money or the Government's —the Minister cannot tell us how much will be involved, because he does not know—to operate a railway service on track owned by another, in the short term, publicly owned company—Railtrack, which itself must achieve an 8 per cent. return? Would any Conservative Member do so?
I note that the hon. Member for Worcester (Mr. Luff) has returned to the Chamber. A few weeks ago, he and I engaged in a short television debate; the last question I asked him was how much of his money he would put up to purchase the railway that runs through his constituency. After all, it is a hundred years or so since the Oxford, Wolverhampton and Worcester railway—known, for some reason, as the Old Worse and Worse, which does not augur particularly well for the future—disappeared into the maw of the Great Western railway.
Unfortunately, the programme ended before I could get a straight answer from the hon. Gentleman however, I should like to know how much of his own money he is willing to put in—as a great supporter of this damned piece of legislation—if there is a management buy-out of the former Old Worse and Worse. Alas, answer came there none; but let me presuppose that the hon. Gentleman will not bankrupt himself, although he may well expect railway managers to bankrupt themselves.
My hon. Friend the Member for Dundee, East (Mr. McAllion) spoke of morale in the railway industry. I have been connected with the industry, in various junior capacities, since the mid-1950s—or, rather, the late 1950s; I should not make myself sound older than I am. I have never known morale to be as low as it is now, from the very top to the very bottom. The Government must accept some responsibility. If they think that managers whose morale has been virtually crushed by their attitude will now rush into MBOs at the behest of the Bill, they have another think coming.
It is nearly 15 long years since the Conservatives came to office. During that time, every member of the British Railways Board has been appointed by a Conservative Secretary of State—or, in some cases, reappointed.

Mr. Deputy Speaker (Mr. Michael Morris): Order. I have allowed a fairly broad debate, but this goes far beyond the general duties of the Secretary of State or, indeed, the regulator.

Mr. Snape: I beg your pardon, Mr. Deputy Speaker, but if the general duties of managers in the industry are to mean anything, we must consider how the industry has


been managed under various Conservative Administrations. However, at your behest, Mr. Deputy Speaker, I shall move on from that argument.
If Railtrack is expected to make the return envisaged under the Bill, railway management will not rush to participate in management buy-outs. The budgetary constraints to which my hon. Friend the Member for Streatham referred are likely to come sooner rather than later. Like him, I appeal to the Minister for Public Transport to assure us that moneys pledged for management buy-outs and for the investment envisaged in the railway industry—which will be privatised if the Government's majority is brought to bear tonight—will not be cut in the Budget later this month. Will he also assure us that that money and investment will not be subjected to the invariable trimming that takes place every time that it is deemed necessary for the axe to fall on public expenditure projects?
If the Minister is serious about encouraging managers to become involved in the future of their industry, the Government will have to perform differently from the way in which they have performed in recent years. If we are made to stagger through the effects of another round of public expenditure cuts, which will fall on the railway industry in particular, morale among managers will collapse even further. That is not good for those who work in the industry; nor, from the Conservative party's point of view, is it good for those who use railway services. I hope that the Minister will give those assurances: those on financing are essential not only from a political point of view but from the point of view of the future of the railway industry.

Mr. Heppell: It is disappointing that, at this late stage of the Bill's passage, hon. Members are in so much of a muddle about the Bill. That muddle was not foreseen when the Bill was introduced or during its Committee stage. The amendments have now been tabled because the Government got the Bill wrong in the first place.
Sometimes people look for complicated arguments to explain the reasons of the Bill. The truth is that there are two reasons for it. The first is Government dogma that privatisation is good and the public sector is bad. The Secretary of State, knowing that being appointed Secretary of State for Transport was likely to be a stepping stone to spending more time with his family, wanted to flex his muscles and show the backwoodsmen on the Government Back Benches that he was made of stern stuff and that he would tackle privatisation. That is the main reason why we are here today. The second reason is simple: the Government have recognised that there are massive amounts of money in British Rail's pension funds and have been trying to get hold of those funds. Those are the reasons why we are here.
The Government had no idea how privatisation should take place, which explains the muddle. If we start from the basis of not knowing where we are going, we may end up where we do not expect to be, which is why the Government are still tabling amendments. In Committee, we seldom had a chance to discuss a clause, because before we could do so the Government amended it. We seldom had a Chance to discuss amendments, because before we could do so the Government amended them. I am sure that

the House of Lords has been through a similar process, with amendment after amendment being tabled. In effect, no one has discussed the original proposals.
There are two specific reasons for Lords amendment No. 1. The first is to cloud and disguise the Government's feelings about BR being able to bid. An amendment was tabled in the other place to allow BR to bid for franchises. Rather than impose conditions that make it impossible for BR to bid, why will not the Government come clean and admit that they oppose the amendment that was passed in the House of Lords and admit that they are doing all they can to frustrate it?
The second reason is Ministers' fears that privatisation will be a failure because insufficient people are prepared to bid. We were told that people in the private sector were queuing up to participate in this great enterprise, but they have not materialised. However, the Government now seem to welcome the thought of a few management buy-outs.
Let us face facts. The private sector will not be attracted without sufficient bribes, which will be given at the expense of the taxpayer. There will be no more management buy-outs without sufficient bribes. Who has heard of such nonsense? The Government talk about a level playing field and about competition, yet they say, "We shall issue a tender under which everyone is equal, but we shall pay for adverts placed by those who tender to help them to bid."
The original purpose of the Bill was to ensure competition. The hon. Member for Surrey, North-West (Sir M. Grylls) spouted about how marvellous it will be when we have competition. Competition has long since been abandoned. It went many months ago when the Government abandoned the idea of open access. After that, they abandoned the idea of anyone competing against the franchisee, effectively ensuring that, when a franchisee won a bid it would have a monopoly on the service. Here is the clearest demonstration that there is no competition. The purpose of the amendment is to allow anyone to bid except BR.
British Rail's management have been encouraged to bid. They have been allowed up to £100,000 of taxpayers' money to prepare their bids. They have been allowed 85 per cent. of the cost of the first £10,000 in preparing their bids and 75 per cent. of the cost of the remainder, with a £100,000 cap on preparation. Is that a sufficient bribe? If it is, it still has not worked. As my hon. Friend the Member for Cunninghame, North (Mr. Wilson) explained, of the 25 directors in charge of existing profit centres that can become TOCs—train operating companies—only five are in the process of becoming such companies. It is interesting that there are so many new words to learn, and TOCs may be one of them. "TOCing" may go into the dictionary. That is not to be mistaken for "TWOCing" —taking without the owner's consent. "TOCing" may have the same definition in the dictionary, but it may or may not mean having consulted the Secretary of State or Minister first.
If we have been bribing management to prepare bids by giving them up to £100,000 to bid against the publicly owned company that we are financing, who is running the railways in the meantime? If the management are not needed to run the railways, one has to ask whether that is the type of management that we want in the first place.
6.30 pm
The truth is that there are no companies ready to bid. Only two companies—British Bus and Stagecoach—participated in a recent seminar held, I think, in August, by the Health and Safety Executive. Not one other company turned up to find out what the safety procedures would be on franchised railways. That tells me one of two things: no other companies are interested in bidding for the franchises or only two companies were sufficiently interested in safety to attend the seminar.
I have no time for the Minister's reassurances about safety. As I said in Committee, if the Minister believed that the recommendations in the Health and Safety Executive's report needed to be implemented, he would have included them in the Bill so that they had to be implemented. Similarly, we had hoped that many pension arrangements would have been included in the Bill. If they had been, tens of thousands of pensioners would not now believe that they have been ratted on by the Secretary of State, who, in effect, gave guarantees to the House which have now been broken in Government admendments.

Mr. Ealfyn Llwyd: You referred to competition. Even if it were still covered in the Bill, do you agree that it is a complete waste of time—

Madam Deputy Speaker (Dame Janet Fookes): Order. I remind the hon. Gentleman that he should be addressing me.

Mr. Llwyd: I am sorry, Madam Deputy Speaker. The hon. Member for Nottingham, East (Mr. Heppell) said that competition was a dead letter in the Bill. My rural constituency contains one west coast railway and one in the north; what possible use is discussion about competition in such an area? I am sure that the socially necessary services are of great concern to us all. My understanding is that the Treasury rules would not allow a guaranteed subsidy for more than three years. I discussed that issue with the Minister earlier this year and I await a reasoned response even now.
The hon. Member for Nottingham, East also mentioned "TOCing", he might be interested to know that the word "tocio" in Welsh means "to cut back".

Mr. Heppell: I thank the hon. Gentleman for that helpful intervention. I agree that the very idea of competition has completely disappeared from the Bill. It is no longer relevant. It is certain that the Government will not allow proper and free competition, including the participation of British Rail. One has only to consider the drafting of the franchising director's powers. When considering bids for services, the criteria will not be who is making the cheapest bid, who is the most efficient or effective or who will provide the best service to passengers or customers. Not one of those criteria will be relevant when BR makes a bid.
Government amendment (a) in lieu of Lords amendment No. 31 states that the franchising director will not have to consider the inclusion of a bid by BR unless it is desirable

"(a) for the purpose of promoting competition for franchises;
(b) for the purpose of promoting the award of franchise agreements to companies in which qualifying railway employees have a substantial interest;
(c) for the purpose of encouraging new entry to the passenger railway industry;

or


(d) for the purpose of preventing or reducing the dominance of any person or person in the market for the provision in Great Britain, or in any part of Great Britain, of services for the carriage of passengers by railway."

Each paragraph means that BR will be left out of the equation. If the Minister and the Secretary of State are not saying that BR is being told that it cannot bid, will the Minister tell the House in what circumstances will it be allowed to bid?

Mr. Bayley: Clause 4, to which the amendments relate, deals with the Secretary of State's powers, and I am pleased to see him back in the Chamber. I should like him to deal with a point raised in paragraph (a) in Lords amendment No. 2, which instructs the regulator to take note of the Secretary of State's guidance. Precisely what guidance will the Secretary of State give the regulator about the need to promote freight on the railways? With reference to paragraph (b), what action will the regulator take to promote the use of rail freight?
Paragraph 46 of the White Paper claims that privatisation
offers the best prospect of attracting new freight to rail with the environmental benefit that this will bring.
The Minister of State made a similar point in Committee. He said:
It is extremely important to protect the interests of all users of the railway network—passengers and freight—and to promote the use of the railway network.
Later that day, he said:
We want Railfreight to develop all sensible business that can be handled by rail."—[Official Report, Standing Committee B, 16 February 1993; c. 136–65.]
On 9 March the Minister told the Committee that new Government grants would be introduced which
will broaden the benefit given to the rail operator"—
vis-a-vis the road operator—
by taking account of the environmental damage caused by heavy goods vehicles on trunk roads and motorways".—[Official Report, Standing Committee B, 9 March 1993; c. 675.]
The rhetoric is fine but, sadly, privatisation will have exactly the reverse effect: it will drive freight business off the railway on to the roads.
Let us take the case of Trainload Freight. In 1992–93, it made a profit of £103 million. I have today seen a memorandum from Graham Smith, Trainload Freight's corporate planning manager. It was dated 13 September 1993 and was sent to all members of the Trainload executive, the board of this British Rail subsidiary. It shows that the company's profits will fall. In 1994–95, profits are expected to be down to £53 million. The following year, it is anticipated that they will be down to £9 million, rising slightly the following year to £17 million and to £27 million the year after.
However, if one takes account of the large number of redundancies expected in the freight sector, which we discussed in Committee, the cash contribution that the company will manage after having met the redundancy payments will fall from more than £100 million last year to £46 million next year, to £4 million the year after and to zero—no profit whatsoever—the following year. That is hardly the rate of return that a private owner would expect on a £400 million business. It does not give much confidence for the future or in the prediction that privatisation will, in the words of the White Paper, move freight from road to rail for environmental reasons.
Senior British Rail managers are telling Ministers that the privatisation of the freight business is a one-way ticket


to liquidation. No wonder there is so much in the Bill about administration orders, winding-up procedures and insolvency: that is what privatisation will do to the freight business.
I have a verbatim record of a meeting between British Rail's chief executive, John Welsby, Trainload Freight managers with the Minister for Public Transport on 11 October 1993. Mr. Welsby said:
I'm just about to appoint three managing directors and I don't want to send them off on bum prospects".
Those managing directors have now been appointed. They are Kim Jordan for the south-eastern division of Trainload Freight, Ian Braybrook for the north-eastern division and Julian Worth for the western division. Is the Secretary of State sending them off on bum prospects? Everyone in Trainload Freight is complaining that the fragmentation —the three-way split of their company—will mean that the operation will lose economies of scale.
At the same meeting, Welsby told the Minister:
You are in a hole and still digging. I don't see how there will be anything still to sell, certainly not the cake, just the cherries.
John Welsby is clearly picking up language used by my hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott), who was the first to talk about cherry picking as the likely consequence of privatisation. The Minister replied to Mr. Welsby:
Thank you for your clear and forthright presentation. The message is not surprising. I've understood the message for some time.
I can imagine the Minister saying precisely that, because he said similar things in Committee. Later at the same meeting, the chief executive of British Rail said:
All you'll be left with is a car boot sale. I'm not joking. We are playing a zero sum game with a totally inelastic market. Every plus is a minus to another rail player. I've got an instruction to start releasing surplus assets. You've even asked for a telephone number.
The Minister replied:
I wouldn't quite put it like that.
With some menace, John Welsby said:
You'll have to sort this one out.
Will the Secretary of State sort it out; more to the point, how will he sort it out at this late stage? When will the Government abandon their poisonous love affair with the juggernaut? When will they stop driving traffic from the railways on to the roads? When will they stop building roads through areas of outstanding natural beauty? When will they stop poisoning people with car fumes and move the traffic from the roads to the railways, as they promised —because they certainly will not achieve that through privatisation?

Mr. Gunnell: I want to comment briefly on clause 4, and in particular on the proposed encouragement of management buy-outs. I believe that, even against the background of the Government's own wishes and intentions, this has not been set about in the right way. We spent 16 hours discussing the clause in Committee. We recognise that the Secretary of State and the regulator have wide-ranging responsibilities under that clause. Price, quality, safety and, as my hon. Friend the Member for York (Mr. Bayley) pointed out, the effect on the environment are all the responsibility of the Secretary of State and the regulator, who must make the best possible regulations and arrangements to fulfil these responsibilities. It is thus understandable that the Government should take the view

that they want British Rail managers to be involved in management buy-outs. I can therefore understand the Government's motivation in introducing a proposal by which they seek to ensure that that happens.
The Government seem to be adopting an extremely doctrinaire position, however. In effect, they are seeking to castrate Lords amendment No. 31 and render it ineffective. That is not a satisfactory way of proceeding—even to get what they themselves want—and an alternative means ought to have been found.
6.45 pm
I was interested to hear that the venture capital industry has little interest in management buy-outs or in the Bill itself. The industry is uncertain about the future and believes that the arrangements that are being put in place are wholly risky. The risks are not risks that most members of the industry want to enter into. Why is the venture capital industry so concerned about and so distant from the legislation, given that, as my hon. Friend the Member for Cunninghame, North (Mr. Wilson) said, the new arrangements will cost us £1.15 billion more than the present arrangements? One would have thought that there would be a lot of money to go around and therefore much by way of potential profit for the industry to garner. One wonders why the industry has no enthusiasm for the Bill.
We must consider what makes a successful management buy-out. I not only have experience of the bus industry buy-out in west Yorkshire but have been involved in a number of other management buy-outs, albeit from a different point of view. It seems to me that such buy-outs have certain qualities in common which have led to their success. The motivation of the managers, their ability to manage and their understanding of their own market are crucial.
Many British Rail managers regard the management buy-out option as the lesser of two evils. Either their job as a whole will be under threat because BR will not be performing the function in question, or they become part of a separate company in order to bid. Choosing the less unsatisfactory option is not the basis on which to form a successful company. The managers have to have enthusiasm and have to want to enter into such an arrangement before the Minister offers them £100,000 to set up. In the context of the services that they will run, £100,000 will not make a very great difference. In the case of successful management buy-outs, one usually finds that those involved are extremely enthusiastic about making money. Enthusiasm about making money is not a quality that is innate in British Rail managers and it does not seem to me that the Bill will help them to acquire that attitude.
It is hard to understand why the Government have not taken the view that to allow British Rail to bid—and bid on an honest and untrammelled basis—would be a far better way of ensuring that services proceeded satisfactorily. Moreover, they should realise that, had they allowed BR to bid for franchises, they would have created circumstances in which many BR managers would have learnt how to operate franchises in the context of belonging to BR.
The Government have told us what they ultimately want —if they, and the Bill, survive long enough for the provisions to come into effect. I can only say that, had they operated as I suggest, they would in effect have been training people who were capable of managing a separate franchise company; instead, they are making people managers and creating their companies for them—or


providing the wherewithal at least to get them started—without ensuring that they have the expertise that they would need to make a success of the Bill.
I say that knowing that the Bill is fatally flawed. Like my hon. Friends, I believe that it is wholly misplaced. It is hard to see the scope for any profitability in the whole process, other than through direct subsidy from the public purse. My experience of dealing with transport and pricing tells me that, if one increases the price, one reduces the number of passengers. Even if they could produce rapidly the quality that the Minister sought, those who managed the companies would find themselves hemmed in by considerations of price and passenger numbers so that the only way in which their company could become profitable would be by an increased subsidy from the public purse. Therefore, we must be clear that the legislation provides for privatisation at public expense.
The fundamental question of my hon. Friend the Member for Cunninghame, North must be addressed. He stressed the lack of motivation among managers as revealed in a survey. However, he also identified the additional costs as a result of this way of tackling the rail system. Those costs, £1.15 billion, are high. It is quite clear that they are the price of dogma and not of practicality.

Mr. Prescott: I do not need to detain the House for long on this issue. From our debate on the amendment, it is clear that one factor has characterised the Bill from the very beginning: the Government have constantly changed their position. In Standing Committee, the Government moved amendments which altered announcements that they made at previous sittings. The Lords amendment is another example of that.
The amendment refers to the Secretary of State's general duties in respect of which he will direct the regulator. According to the Bill, it is the Secretary of State's duty
to exercise the functions assigned or transferred to him under or by virtue of this Part in the manner which he considers best calculated".
The Bill then makes those calculations clear. They are
(a) to protect the interests of users of railway services".
The Secretary of State must make that judgment. The calculations continue:
(b) to promote the use of the railway network…(c) to promote efficiency and economy".
I like the next calculation:
(d) to promote competition".
I am not sure whether it has anything to do with competition. As other hon. Members have made clear, only one franchise will be operated on a particular line. There will be no competition. Preference in a bid will be given to the private sector bidder even if the BR bid is better. Quite frankly, this has nothing to do with competition. Clearly, the idea that competition is the best way to provide a better railway service for railway users is in doubt.
The Minister for Public Transport referred us to the debates that took place in the other place. That was a bit of a cheek. I hope that he will give us a proper explanation of the amendments, as that is what the House would expect. It would be proper for him to do that.
It has been difficult to study the 450-odd Lords amendments in detail, because they became available in their present form only last Thursday. I want to raise a little protest. The Lords amendments refer to specific clauses. As I understand it, the relevant lines are not numbered in Lords amendments. Thai makes it extremely difficult to

find the relevant sections. I hope that that procedure will be simplified because I spent most of Sunday trying to relate the amendments to the Bill. I do not recommend that exercise to anyone, but I had to do that in order to find out exactly what the Lords amendments did to the Bill. If the relevant lines were marked in the margin, that would make it much easier for us to make better contributions. I hope that we can all agree that that change should be made and that my protest will be noted in the appropriate quarters.
The Minister asked us to assess, according to the Lords amendment, that the regulator could give preference to a bid from a company in which British Rail employees have a substantial interest. The Minister said that he could not define "substantial". Clearly, someone will have to define "substantial" because it is a crucial point. If BR employees held 1 per cent. or 2 per cent. of a buy-out, that would clearly not be considered to be substantial.
I do not understand why the Minister cannot have a stab at defining "substantial". For example, in monopolies legislation, control of the market relates to more than 30 or 40 per cent. There are various areas in respect of which we must make judgments. Someone will have to judge and it would not be wise to leave it to the courts. The Government must have an idea of what constitutes a substantial bid.
I am afraid that the Secretary of State will direct the regulator to give preference to a certain bid, such as an up-front employee buy-out in which BR employees represent only 10 per cent. of the company. The private sector would be using those employees to achieve a cheaper bid. That seems a very curious way of bidding for franchises. The only competition in the Bill is that for subsidies. As the Minister made clear, very few franchises will make a profit. That is why we are arguing about the £2 billion which is double the largest public service obligation payment.
The Secretary of State appeared on "On the Record" at the weekend. I could not challenge him on that programme as I was taken off it. He said that the £2 billion was not for one line. We know that. The £2 billion referred to in the Department of Transport document is assessed on the basis of apportioning a profit to the rate of return, or return on capital, for the track or assets. That calculation amounts to £2 billion. However, the Department's document makes no assessment of the operator's profit because that has not been calculated. The figure that we are talking about is £2 billion-plus.
If BR had been given a fraction of that money to run a good railway system, it would be fair to judge whether BR could run a good service. Instead, BR has been forced to live on a quarter of the resources and to cut available services. Because of the inadequate resources made available to it, BR has been forced to cut services and it has been condemned for that. If the private sector makes a bid under Lords amendment No. 1, all sorts of money will be available for that bid, but that money is denied to BR. That is unfair.
As hon. Members have said, there is so much of a tilt towards a management buy-out because the Government had a difficulty in the other place. Their Lordships supported the idea that BR should be allowed to bid for a franchise and the Opposition will support that when we reach that part of the debate. British Rail, as a corporate body, should be allowed to bid exactly as happens in


Sweden in similar circumstances. The Government will oppose that when we reach those amendments later. The alternative is to allow a few managers to buy in.
As was made clear earlier, the reason for all this concern about management buy-outs is that we no longer hear the rhetoric about 30 companies lining up to bid for the franchises. Virgin has made it very clear that it would have difficulty bidding in such circumstances. Stagecoach ran a service which collapsed. Stagecoach sued me for saying that it collapsed. I said that outside and I repeat it here. That service no longer remains and that sounds to me as though it has collapsed. It was taken off before the lease to run the system ran out.
The private sector is no longer talking about bids. The Minister does not want to give BR an opportunity because he made it clear at the earliest stages of the Bill that if BR were allowed to bid for franchises it would punch a big hole in the Bill, so the Minister has had to concoct a formula to allow managers to bid.
I do not know whether the Secretary of State has talked to the managers to discover whether they agree with privatisation or with bids of this kind. I assume that he has done that. I am sure that our evidence, produced by the trade unions in assessing the view of the managers, has been sent to the Secretary of State, so I shall not repeat it, but when asked how many were in favour of privatisation, 88 per cent. were against. When asked whether they were in favour of the British Railways Board handling franchises, 74 per cent. said yes and that they would like to be able to bid for franchises. When asked whether they were in favour of a management buy-out in preference to BRB's bidding, 68 per cent. were very much against that because it would create great tensions within BR.
No doubt those managers will read the reports of this debate. I must tell them that if they choose to bid in those circumstances to run a private sector railway instead of a public sector railway, they have declared their hand. We believe that it should be a public sector railway. It should be subject to public accountability and meet public needs. We have made clear our position on that point; it could not be clearer. We want managers who believe in the system.
I hope that managers who make bids remind themselves that, if it goes back to a publicly owned system, we might look elsewhere for managers rather than look to those who have shown their hands. [Interruption.] That is fair for managers who judge whether they should change their careers and pension arrangements and bid for a private sector line or remain in the public service.
The Government's principle is that BR will still run the majority of services. We still want BR to run services. It is fair for the Opposition to want people who believe in a publicly owned system running a public railway. I hope that the message will go out loud and clear to those who seek to depart from that position. That is the point that I make to managers who are considering making bids. They have made their position clear.
The amendment is solely about trying to save the Government's face. There are no private sector people queuing up to bid, even with the massive bribes being offered'to them. The Government will deny British Rail the right to make bids—that is clear from what they have

said—and they hope that a few managers will be encouraged to get together with the private sector. We are against that and we shall oppose the amendment.
We will not vote against all the amendments because there is insufficient time to deal with all the important issues. We shall therefore vote on amendment No. 1 and not push votes on the other amendments, although we are clearly against other amendments. We want to make it clear that we believe in British Rail having the right to run services. The amendment undermines British Rail's corporate ability to do that.

7 pm

Mr. Freeman: I will seek to answer as concisely as I can some of the points that have been raised in this important debate. It has taken two hours, but it has covered very important issues, and they need to be addressed, albeit as succinctly as I can.
The hon. Member for Kingston upon Hull, East (Mr. Prescott) asked what "a substantial interest" is. The Government believe that, in certain circumstances, that can be less than a 50 per cent. interest in the entire equity, but I stand by my earlier remarks—the courts will eventually decide precisely what that definition means. It is clearly because different circumstances will apply in each management and employee buy-out.
The hon. Gentleman again raised the matter of £2 billion, which his colleague the hon. Member for Cunninghame, North (Mr. Wilson) raised earlier. I make it absolutely plain that they were quoting from a working document within the Department of Transport. No decision has been taken on the financial regime for Railtrack, and my right hon. Friend the Secretary of State for Transport will settle that matter in due course after the unified Budget which is to be presented at the end of the month.
Clearly, some account must be taken in setting the franchising director's budget for the new regime of track charges that Railtrack will introduce. Therefore, to the extent that Railtrack, a public sector body, earns more, that money will be available to the public sector to provide additional funding not only to the franchising director but, as I have already given commitments to the passenger transport authorities and executives, for the running of railway services. To that extent, the movement of money is circular. My right hon. Friend will be making a clear statement and set the external financing limits not only of British Rail but of Railtrack and the franchising director in due course.

Mr. Wilson: Will the Minister give way?

Mr. Freeman: If the hon. Gentleman will forgive me, in a minute or two, when I come to his remarks, I will certainly give way.
The hon. Member for Morley and Leeds, East (Mr. Gunnell) talked about an apparent lack of interest from financial institutions. That is not the case. My right hon. Friend and I have had several meetings with financial institutions, including venture capital interests, and they are interested. This is a very early stage in the franchising process. We do not expect the majority of the first seven franchises actually to be let until 1995. It is very early days.
The hon. Member for York (Mr. Bayley) referred to Trainload Freight. Of course there is a conflict or a


dilemma—to be resolved, as I admitted in Standing Committee and I admit now; intellectually, it is obvious —between maximising receipts from the sale of Trainload Freight and maximising open-access competition. That we will do.
We have not yet resolved the regime for the Trainload Freight companies or the degree to which, for example, surplus wagons and engines will be available to new entrants, but we are determined to ensure that we have managers in place not only for the Trainload Freight companies but also, I expect, for private companies to make maximum possible use of our rail freight network in this country. The initiatives that we have put in place—for example, that track charges will be based on avoidable costs, widening the section 8 criteria for grants to new rail terminals, and the track subsidy regime—are intended to promote the use of rail freight.
The hon. Member for Nottingham, East (Mr. Heppell) asked about private sector interest and whether it has materialised. I repeat the assertion that I made at the beginning: I have visited most—[Interruption.] It is an assertion, because I am not producing any evidence to the House tonight. I am asserting that I have visited most of the potential rail franchises and I have found considerable enthusiasm among senior management for our proposals. They are anxious to get on with the process of franchising.
The hon. Members for West Bromwich, East (Mr. Snape) and for East Lothian (Mr. Home Robertson) talked about safety. I repeat again that the Health and Safety Commission, on behalf of the Health and Safety Executive, made 37 recommendations about safety. The Government accepted all of them, as did British Rail. The Health and Safety Executive will have overall responsibility for safety, and Railtrack will administer the regime on a day-to-day basis. The Government do not accept that the privatised railway will be any less safe than British Rail.
The hon. Member for Dundee, East (Mr. McAllion) said that, according to his information, the east coast main line, while in public ownership, will continue to run through services to Inverness and Aberdeen. I am delighted. When the franchising director franchises the service, it will be based on the services that British Rail runs immediately prior to franchising. Therefore, the hon. Gentleman should draw some reassurances from what he has been told.
The hon. Member for Streatham (Mr. Hill) asked several questions about Railtrack. Railtrack is not on the face of the Bill because several possible network operators —owners of infrastructure—could be in play in future years, including Railtrack. That is obviously one, and certainly the major, operator. The hon. Gentleman asked whether franchisees could buy operations and infrastructure—a vertical integration. That is not the Government's policy, and we have made that plain. Apart from one limited exception, which will be the case of the Isle of Wight, that is not our policy, and that is set out very clearly in the draft objectives to the franchising director.
The hon. Member for Streatham asked about access charges, as did the hon. Member for Cunninghame., North. As I have said, we have not set the financial regime, but Coopers and Lybrand has now completed a substantial part of its work. From today, freight operators will be able to obtain a quote on the track charges that will apply to them when they start running services.
On passenger services, I make the obvious point that, because the franchising director will be essentially acquiring access to the whole of the railway network, the

franchising director will be providing Railtrack with a substantial part of Railtrack' s income and taking the revenue risk on the ability to franchise.

Mr. Wilson: Will the Minister give way?

Mr. Freeman: I was going to answer the hon. Gentleman's points. Perhaps he would like to hear the answers first.
The hon. Member for Cunninghame, North quoted the survey conducted by TSSA, one of the three major rail unions. The hon. Member for Kingston upon Hull, East was good enough to admit that it might be a little partisan. That does not square with the evidence before the Department. There is significant interest on the part of senior rail managers who actually run the trains in the different divisions. [Interruption.] I would be very happy in due course, as and when the franchising director receives bids and then lets franchises, to make sure that the public are well aware of the interest.
In commending the Lords amendments—

Mr. Wilson: Will the Minister give way?

Mr. Freeman: No, I must finish. [Interruption.] I am answering the hon. Gentleman's points.
In commending the amendments to the House, I draw attention to the two points that the Opposition spokesman has made tonight. First, the Opposition are opposed to British Rail managers and staff bidding for franchises. They should tell that to British Rail management. Many managers want the chance to have an equity interest in running British Rail. Secondly, the hon. Gentleman is quite clear and candid—he does not want to break British Rail's monopoly. I agree with my hon. Friend the Member for Surrey, North-West (Sir M. Grylls) that breaking the monopoly, permitting competition and permitting the private sector to come in will revolutionise rail services and will improve the quality of service.

Mr. Wilson: With the leave of the House—

Madam Deputy Speaker: I am afraid that it is not possible under the rules to permit the hon. Gentleman to speak again. I understand the hon. Gentleman's disquiet, but I cannot permit that.

Mr. Wilson: On a point of order, Madam Deputy Speaker. Is it in order for the Minister to say that he will give way and then not give way? Is that not a breach of the courtesies of the House, if not of its rules?

Madam Deputy Speaker: I am afraid that it is not a matter for the Chair and therefore one on which I cannot rule.

Question put, That this House doth agree with the Lords in the said amendment:—

The House divided: Ayes 321, Noes 283.

Division No. 378]
[7.09 pm


AYES


Ainsworth, Peter (East Surrey)
Ashby, David


Aitken, Jonathan
Aspinwall, Jack


Alexander, Richard
Atkins, Robert


Alison, Rt Hon Michael (Selby)
Atkinson, David (Bour'mouth E)


Allason, Rupert (Torbay)
Atkinson, Peter (Hexham)


Amess, David
Baker, Rt Hon K. (Mole Valley)


Ancram, Michael
Baker, Nicholas (Dorset North)


Arbuthnot, James
Baldry, Tony


Arnold, Jacques (Gravesham)
Banks, Matthew (Southport)


Arnold, Sir Thomas (Hazel Grv)
Banks, Robert (Harrogate)






Bates, Michael
Forsyth, Michael (Stirling)


Batiste, Spencer
Forsythe, Clifford (Antrim S)


Bellingham, Henry
Forth, Eric


Bendall, Vivian
Fowler, Rt Hon Sir Norman


Beresford, Sir Paul
Fox, Dr Liam (Woodspring)


Biffen, Rt Hon John
Fox, Sir Marcus (Shipley)


Blackburn, Dr John G.
Freeman, Rt Hon Roger


Body, Sir Richard
French, Douglas


Bonsor, Sir Nicholas
Fry, Peter


Booth, Hartley
Gale, Roger


Boswell, Tim
Gallaie, Phil


Bottomley, Peter (Eltham)
Gardiner, Sir George


Bottomley, Rt Hon Virginia
Garel-Jones, Rt Hon Tristan


Bowden, Andrew
Garnier, Edward


Bowis, John
Gill, Christopher


Boyson, Rt Hon Sir Rhodes
Gillan, Cheryl


Brandreth, Gyles
Goodlad, Rt Hon Alastair


Brazier, Julian
Goodson-Wickes, Dr Charles


Bright, Graham
Gorman, Mrs Teresa


Brooke, Rt Hon Peter
Gorst, John


Browning, Mrs. Angela
Grant, Sir A. (Cambs SW)


Bruce, Ian (S Dorset)
Greenway, Harry (Ealing N)


Budgen, Nicholas
Greenway, John (Ryedale)


Burns, Simon
Griffiths, Peter (Portsmouth, N)


Burt, Alistair
Grylls, Sir Michael


Butcher, John
Gummer, Rt Hon John Selwyn


Butler, Peter
Hague, William


Carlisle, John (Luton North)
Hamilton, Rt Hon Archie (Epsom)


Carlisle, Kenneth (Lincoln)
Hamilton, Neil (Tatton)


Carrington, Matthew
Hanley, Jeremy


Carttiss, Michael
Hannam, Sir John


Cash, William
Hargreaves, Andrew


Channon, Rt Hon Paul
Harris, David


Chapman, Sydney
Haselhurst, Alan


Churchill, Mr
Hawkins, Nick


Clappison, James
Hawksley, Warren


Clarke, Rt Hon Kenneth (Ruclif)
Hayes, Jerry


Clifton-Brown, Geoffrey
Heald, Oliver


Coe, Sebastian
Heathcoat-Amory, David


Colvin, Michael
Hendry, Charles


Congdon, David
Heseltine, Rt Hon Michael


Conway, Derek
Higgins, Rt Hon Sir Terence L.


Coombs, Anthony (Wyre For'st)
Hill, James (Southampton Test)


Coombs, Simon (Swindon)
Hogg, Rt Hon Douglas (G'tham)


Cope, Rt Hon Sir John
Horam, John


Cormack, Patrick
Hordern, Rt Hon Sir Peter


Couchman, James
Howard, Rt Hon Michael


Cran, James
Howarth, Alan (Strat'rd-on-A)


Currie, Mrs Edwina (S D'by'ire)
Howell, Rt Hon David (G'dford)


Curry, David (Skipton & Ripon)
Howell, Sir Ralph (N Norfolk)


Davies, Quentin (Stamford)
Hunt, Rt Hon David (Wirral W)


Davis, David (Boothferry)
Hunt, Sir John (Ravensbourne)


Day, Stephen
Hunter, Andrew


Deva, Nirj Joseph
Hurd, Rt Hon Douglas


Devlin, Tim
Jack, Michael


Dickens, Geoffrey
Jackson, Robert (Wantage)


Dicks, Terry
Jenkin, Bernard


Dorrell, Stephen
Jessel, Toby


Douglas-Hamilton, Lord James
Johnson Smith, Sir Geoffrey


Dover, Den
Jones, Gwilym (Cardiff N)


Duncan, Alan
Jones, Robert B. (W Hertfdshr)


Duncan-Smith, Iain
Jopling, Rt Hon Michael


Dunn, Bob
Kellett-Bowman, Dame Elaine


Durant, Sir Anthony
Key, Robert


Dykes, Hugh
Kilfedder, Sir James


Eggar, Tim
King, Rt Hon Tom


Elletson, Harold
Kirkhope, Timothy


Emery, Rt Hon Sir Peter
Knapman, Roger


Evans, David (Welwyn Hatfield)
Knight, Mrs Angela (Erewash)


Evans, Jonathan (Brecon)
Knight, Greg (Derby N)


Evans, Nigel (Ribble Valley)
Knight, Dame Jill (Bir'm E'st'n)


Evans, Roger (Monmouth)
Knox, Sir David


Evennett, David
Kynoch, George (Kincardine)


Faber, David
Lait, Mrs Jacqui


Fabricant, Michael
Lang, Rt Hon Ian


Fairbaim, Sir Nicholas
Lawrence, Sir Ivan


Fenner, Dame Peggy
Legg, Barry


Field, Barry (Isle of Wight)
Leigh, Edward


Fishburn, Dudley
Lennox-Boyd, Mark


Forman, Nigel
Lidington, David





Lightbown, David
Scott, Rt Hon Nicholas


Lilley, Rt Hon Peter
Shaw, David (Dover)


Lloyd, Peter (Fareham)
Shaw, Sir Giles (Pudsey)


Lord, Michael
Shephard, Rt Hon Gillian


Luff, Peter
Shepherd, Colin (Hereford)


Lyell, Rt Hon Sir Nicholas
Shersby, Michael


MacGregor, Rt Hon John
Sims, Roger


MacKay, Andrew
Skeet, Sir Trevor


Maclean, David
Smith, Sir Dudley (Warwick)


McLoughlin, Patrick
Smith, Tim (Beaconsfield)


McNair-Wilson, Sir Patrick
Smyth, Rev Martin (Belfast S)


Madel, David
Soames, Nicholas


Maitland, Lady Olga
Spencer, Sir Derek


Major, Rt Hon John
Spicer, Sir James (W Dorset)


Malone, Gerald
Spicer, Michael (S Worcs)


Mans, Keith
Spink, Dr Robert


Marland, Paul
Spring, Richard


Marlow, Tony
Sproat, Iain


Marshall, John (Hendon S)
Squire, Robin (Hornchurch)


Marshall, Sir Michael (Arundel)
Stanley, Rt Hon Sir John


Martin, David (Portsmouth S)
Steen, Anthony


Mawhinney, Dr Brian
Stephen, Michael


Mayhew, Rt Hon Sir Patrick
Stern, Michael


Mellor, Rt Hon David
Stewart, Allan


Merchant, Piers
Streeter, Gary


Milligan, Stephen
Sumberg, David


Mills, Iain
Sweeney, Walter


Mitchell, Andrew (Gedling)
Sykes, John


Mitchell, Sir David (Hants NW)
Tapsell, Sir Peter


Moate, Sir Roger
Taylor, Ian (Esher)


Molyneaux, Rt Hon James
Taylor, John M. (Solihull)


Monro, Sir Hector
Taylor, Sir Teddy (Southend, E)


Montgomery, Sir Fergus
Temple-Morris, Peter


Moss, Malcolm
Thomason, Roy


Needham, Richard
Thompson, Sir Donald (C'er V)


Nelson, Anthony
Thompson, Patrick (Norwich N)


Neubert, Sir Michael
Thornton, Sir Malcolm


Newton, Rt Hon Tony
Thurnham, Peter


Nicholls, Patrick
Townend, John (Bridlington)


Nicholson, David (Taunton)
Townsend, Cyril D. (Bexl'yh'th)


Nicholson, Emma (Devon West)
Tracey, Richard


Norris, Steve
Tredinnick, David


Onslow, Rt Hon Sir Cranley
Trend, Michael


Oppenheim, Phillip
Trimble, David


Ottaway, Richard
Trotter, Neville


Page, Richard
Twinn, Dr Ian


Paice, James
Vaughan, Sir Gerard


Patnick, Irvine
Viggers, Peter


Patten, Rt Hon John
Waldegrave, Rt Hon William


Pattie, Rt Hon Sir Geoffrey
Walker, Bill (N Tayside)


Pawsey, James
Waller, Gary


Peacock, Mrs Elizabeth
Ward, John


Pickles, Eric
Wardle, Charles (Bexhill)


Porter, David (Waveney)
Waterson, Nigel


Portillo, Rt Hon Michael
Watts, John


Powell, William (Corby)
Wells, Bowen


Rathbone, Tim
Whitney, Ray


Redwood, Rt Hon John
Whittingdale, John


Renton, Rt Hon Tim
Widdecombe, Ann


Richards, Rod
Wiggin, Sir Jerry


Riddick, Graham
Wilkinson, John


Rifkiand, Rt Hon. Malcolm
Willetts, David


Robathan, Andrew
Wilshire, David


Roberts, Rt Hon Sir Wyn
Winterton, Nicholas (Macc'f'ld)


Robertson, Raymond (Ab'd'n S)
Wolfson, Mark


Robinson, Mark (Somerton)
Wood, Timothy


Roe, Mrs Marion (Broxbourne)
Yeo, Tim


Ross, William (E Londonderry)
Young, Rt Hon Sir George


Rowe, Andrew (Mid Kent)



Rumbold, Rt Hon Dame Angela
Tellers for the Ayes:


Ryder, Rt Hon Richard
Mr. Robert G. Hughes and


Sackville, Tom
Mr. Michael Brown.


Sainsbury, Rt Hon Tim



NOES


Abbott, Ms Diane
Alton, David


Adams, Mrs Irene
Anderson, Donald (Swansea E)


Ainger, Nick
Anderson, Ms Janet (Ros'dale)


Ainsworth, Robert (Cov'try NE)
Armstrong, Hilary


Allen, Graham
Ashton, Joe






Austin-Walker, John
Foster, Don (Bath)


Banks, Tony (Newham NW)
Foulkes, George


Barnes, Harry
Fraser, John


Barron, Kevin
Fyfe, Maria


Battle, John
Galloway, George


Bayley, Hugh
Gapes, Mike


Beckett, Rt Hon Margaret
Garrett, John


Beith, Rt Hon A. J.
George, Bruce


Bell, Stuart
Gerrard, Neil


Benn, Rt Hon Tony
Gilbert, Rt Hon Dr John


Bennett, Andrew F.
Godman, Dr Norman A.


Benton, Joe
Godsiff, Roger


Bermingham, Gerald
Golding, Mrs Llin


Berry, Dr. Roger
Gordon, Mildred


Betts, Clive
Graham, Thomas


Blair, Tony
Grant, Bemie (Tottenham)


Blunkett, David
Griffiths, Nigel (Edinburgh S)


Boateng, Paul
Griffiths, Win (Bridgend)


Boyce, Jimmy
Grocott, Bruce


Boyes, Roland
Gunnell, John


Bradley, Keith
Hain, Peter


Bray, Dr Jeremy
Hall, Mike


Brown, Gordon (Dunfermline E)
Hanson, David


Brown, N. (N'c'tle upon Tyne E)
Hardy, Peter


Burden, Richard
Harman, Ms Harriet


Byers, Stephen
Harvey, Nick


Callaghan, Jim
Hattersley, Rt Hon Roy


Campbell, Mrs Anne (C'bridge)
Henderson, Doug


Campbell, Menzies (Fife NE)
Heppell, John


Campbell, Ronnie (Blyth V)
Hill, Keith (Streatham)


Campbell-Savours, D. N.
Hinchliffe, David


Canavan, Dennis
Hoey, Kate


Cann, Jamie
Hogg, Norman (Cumbernauld)


Carlile, Alexander (Montgomry)
Home Robertson, John


Chisholm, Malcolm
Hood, Jimmy


Clark, Dr David (South Shields)
Hoon, Geoffrey


Clarke, Eric (Midlothian)
Howarth, George (Knowsley N)


Clarke, Tom (Monklands W)
Howells, Dr. Kim (Pontypridd)


Clelland, David
Hoyle, Doug


Clwyd, Mrs Ann
Hughes, Kevin (Doncaster N)


Coffey, Ann
Hughes, Robert (Aberdeen N)


Cohen, Harry
Hughes, Roy (Newport E)


Connarty, Michael
Hughes, Simon (Southwark)


Cook, Frank (Stockton N)
Hume, John


Cook, Robin (Livingston)
Hutton, John


Corbett, Robin
Illsley, Eric


Corbyn, Jeremy
Jackson, Glenda (H'stead)


Corston, Ms Jean
Jackson, Helen (Shefld, H)


Cousins, Jim
Jamieson, David


Cox, Tom
Janner, Greville


Cryer, Bob
Johnston, Sir Russell


Cummings, John
Jones, Barry (Alyn and D'side)


Cunliffe, Lawrence
Jones, Jon Owen (Cardiff C)


Cunningham, Jim (Covy SE)
Jones, Lynne (B'ham S O)


Cunningham, Rt Hon Dr John
Jones, Martyn (Clwyd, SW)


Dafis, Cynog
Jones, Nigel (Cheltenham)


Darling, Alistair
Jowell, Tessa


Davidson, Ian
Kaufman, Rt Hon Gerald


Davies, Rt Hon Denzil (Llanelli)
Keen, Alan


Davies, Ron (Caerphilly)
Kennedy, Charles (Ross,C&S)


Davis, Terry (B'ham, H'dge H'I)
Kennedy, Jane (Lpool Brdgn)


Denham, John
Khabra, Piara S.


Dewar, Donald
Kirkwood, Archy


Dixon, Don
Leighton, Ron


Dobson, Frank
Lestor, Joan (Eccles)


Donohoe, Brian H.
Lewis, Terry


Dowd, Jim
Livingstone, Ken


Dunnachie, Jimmy
Lloyd, Tony (Stretford)


Dunwoody, Mrs Gwyneth
Llwyd, Elfyn


Eagle, Ms Angela
Loyden, Eddie


Eastham, Ken
Lynne, Ms Liz


Enright, Derek
McAllion, John


Etherington, Bill
McAvoy, Thomas


Evans, John (St Helens N)
McCrea, Rev William


Ewing, Mrs Margaret
Macdonald, Calum


Fatchett, Derek
McFall, John


Field, Frank (Birkenhead)
McGrady, Eddie


Fisher, Mark
McKelvey, William


Flynn, Paul
Mackinlay, Andrew


Foster, Rt Hon Derek
McLeish, Henry





Maclennan, Robert
Robinson, Geoffrey (Co'try NW)


McMaster, Gordon
Robinson, Peter (Belfast E)


McNamara, Kevin
Roche, Mrs. Barbara


McWilliam, John
Rogers, Allan


Madden, Max
Rooker, Jeff


Maddock, Mrs Diana
Rooney, Terry


Mahon, Alice
Ross, Ernie (Dundee W)


Mandelson, Peter
Rowlands, Ted


Marek, Dr John
Ruddock, Joan


Marshall, David (Shettleston)
Salmond, Alex


Marshall, Jim (Leicester, S)
Sedgemore, Brian


Martin, Michael J. (Springburn)
Sheerman, Barry


Martlew, Eric
Sheldon, Rt Hon Robert


Maxton, John
Shore, Rt Hon Peter


Meacher, Michael
Short, Clare


Meale, Alan
Simpson, Alan


Michael, Alun
Skinner, Dennis


Michie, Bill (Sheffield Heeley)
Smith, Andrew (Oxford E)


Michie, Mrs Ray (Argyll Bute)
Smith, C. (Isl'ton S & F'sbury)


Milburn, Alan
Smith, Rt Hon John (M'kl'ds E)


Miller, Andrew
Smith, Llew (Blaenau Gwent)


Mitchell, Austin (Gt Grimsby)
Snape, Peter


Moonie, Dr Lewis
Soley, Clive


Morgan, Rhodri
Spearing, Nigel


Money, Elliot
Squire, Rachel (Dunfermline W)


Morris, Rt Hon A. (Wy'nshawe)
Steinberg, Gerry


Morris, Estelle (B'ham Yardley)
Stevenson, George


Morris, Rt Hon J. (Aberavon)
Stott, Roger


Mowlam, Marjorie
Strang, Dr. Gavin


Mudie, George
Straw, Jack


Mullin, Chris
Taylor, Mrs Ann (Dewsbury)


Murphy, Paul
Taylor, Matthew (Truro)


Oakes, Rt Hon Gordon
Thompson, Jack (Wansbeck)


O'Brien, Michael (N W'kshire)
Tipping, Paddy


O'Brien, William (Normanton)
Turner, Dennis


O'Hara, Edward
Tyler, Paul


Olner, William
Walker, Rt Hon Sir Harold


O'Neill, Martin
Wallace, James


Orme, Rt Hon Stanley
Walley, Joan


Paisley, Rev Ian
Wardell, Gareth (Gower)


Parry, Robert
Wareing, Robert N


Patchett, Terry
Watson, Mike


Pendry, Tom
Welsh, Andrew


Pickthall, Colin
Wicks, Malcolm


Pike, Peter L.
Wigley, Dafydd


Pope, Greg
Williams, Rt Hon Alan (Sw'n W)


Powell, Ray (Ogmore)
Williams, Alan W (Carmarthen)


Prentice, Ms Bridget (Lew'm E)
Wilson, Brian


Prentice, Gordon (Pendle)
Winnick, David


Prescott, John
Wise, Audrey


Primarolo, Dawn
Worthington, Tony


Purchase, Ken
Wray, Jimmy


Quin, Ms Joyce
Wright, Dr Tony


Radice, Giles
Young, David (Bolton SE)


Raynsford, Nick



Redmond, Martin
Tellers for the Noes:


Reid, Dr John
Mr. Peter Kilfoyle and


Rendel, David
Mr. John Spellar.


Robertson, George (Hamilton)

Question accordingly agreed to

Subsequent Lords amendments agreed to.

Dr. Marek: On a point of order, Madam Deputy Speaker. I rose to speak during the previous debate, but you put the question without raising your eyes, and did not see me. When you next put a question, will you perhaps raise your eyes to see whether some of us on the Back Benches are still trying to enter the debate?

Madam Deputy Speaker: I am sorry that I missed the hon. Gentleman. I genuinely thought that all those Back Benchers who wished to contribute had already done so.

Clause 5

GENERAL DUTIES OF THE FRANCHISING DIRECTOR

Lords amendment: No. 4, in page 6, line 4, after ("to") insert—("(i)")

Mr. Freeman: I beg to move, That this House doth agree with the Lords in the said amendment.

Madam Deputy Speaker: With this we may take Lords amendments Nos. 5, 32, 34 to 36, 38 to 43, 124 to 130 and 133.

Mr. Freeman: Lords amendment No. 4 is grouped with a number of other amendments for the convenience of the debate. The main purpose of—[Interruption.]

Madam Deputy Speaker: Order. This is not a gossiping session. If hon. Members wish to remain, they should stay silent. If they wish to go, they should do so quietly.

Mr. Freeman: The main purpose of the group of amendments is to deal with the implications of our announcement on the future for railway stations. There are a number of technical amendments on which I shall be happy to respond if there are any especial questions. I am sure that it would help the House if I explain why we need amendments to the Bill to deal with our policy on the operation of stations.
Through franchise arrangements, we propose to allow franchisees, also, to operate—that is to say manage—stations. The scope of that operation could include light maintenance depots, for example, where the railway trains are maintained on a weekly basis. It is clear to us that the Bill needs to be amended to make it clear that a franchisee will be able to operate—possibly under a lease arrangement as we currently intend—the stations along the line of the route or routes that fall within the franchise area.
For some larger stations, of which there probably number no more than two dozen, separate arrangements may be appropriate, but for most stations—there are 2,500 in the British Rail network—the majority will be run by and managed for a period conterminous with the franchise arrangement by the franchisee; the train operating company. Those companies will be responsible not as freeholders of the building, but for car parking and ticket arrangements, for facilities available for passengers and for train, information systems on the stations. That is common sense.
There are some large stations—a number outside the metropolis—where we want to encourage the private sector to be involved in the development of stations, especially in the air rights above stations. Where it might be sensible to bring in separate private sector managers of the commercial facilities such as the shops—

Mrs. Dunwoody: rose—

Mr. Freeman: The hon. Lady has obviously not been to Liverpool Street station or to Victoria or to Waterloo and seen the benefits of the development.

Mrs. Dunwoody: Is not the Minister making it clear that, if no money can be made by running a railway, there can always be development of the air space above the railway which can be leased out to any property developer who wants to build something of the enormous architectural brilliance of Alban Gate?

Mr. Freeman: I am surprised that the hon. Lady doubts that there are opportunities from the development of station premises that would benefit Railtrack, and therefore the rail infrastructure. That seems perfectly straightforward to me.

Dr. Marek: I accept that some railway stations in metropolitan areas and in the capital could have such developments. What will the Lords amendments do for my constituents who use Wrexham station? The station is rotten and water is seeping through it. It is dank and it has not been repaired for years. Rooms in it have been available for letting for years and years, but there have been no takers. How will the amendments change that?

Mr. Freeman: Certainly the hon. Gentleman's station does not seem to be a good opportunity for major private sector development. I am sure that the hon. Gentleman summarises the position accurately. However, Railtrack will have continuing responsibilities for the maintenance of the infrastructure and, together with the train operating companies—the franchisees—will ensure that facilities are modernised to attract passengers on to the railway. I do not know the hon. Gentleman's station, although I am sure that I shall visit it during one of my travels in his part of the country.
The announcement by my right hon. Friend the Secretary of State for Transport about new opportunities for railway stations made it clear that the freeholds would be retained by Railtrack and that the majority of stations would be leased to the franchised train operators. Railtrack will develop options for the larger stations, including sales on long leases of up to 125 years. There will be safeguards, which are replicated in the Lords amendments, for train operators and passengers through station access. The hon. Member for York (Mr. Bayley) has raised the point on a number of occasions. We must ensure that train operators have proper access to all stations through which they run services, and that is provided for in the amendments.
I shall be happy to respond to any specific points. I hope that I have been helpful to the House in explaining the main policy purpose behind the amendments. I commend them to the House.

Mr. Wilson: The main policy purpose of the Lords amendments appears to be to flog the largest stations at which the greatest amount of public investment has already occurred. That is par for the course. I am sure that all hon. Members were interested in the Minister's less than forthright disavowal of the £2 billion figure—a point that is also relevant to the amendments. It was at least an advance on yesterday's performance by the Secretary of State. He purported to believe that the increase in the poublic service obligation grant to British Rail envisaged in his Department's documents referred to one specific line that would be franchised. On the basis that it could not cost an extra £1.15 billion to franchise a single line, he regarded the whole thing as nonsense. We have obviously moved on. Even if the Secretary of State did not recognise the documents, the Minister recognised them, and the £2 billion figure is all too clear.
The message that goes out from the Minister—we do not yet know how the Government will fiddle around trying to avoid this rather embarrassing figure—is that there will be a massive increase in grant not for the


development of railways and not for the development of stations, which we are discussing now, but purely for the restructuring of the railways to accommodate privatisation. That is the message that has come from the Minister this evening.
I point out to Conservative Members who are interested in these matters that the Department of Transport documents, at the highest possible level, envisage a £1·15 billion increase in the PSO grant to the railways to pay for privatisation in the coming year. The former Chancellor of the Exchequer, the right hon. Member for Kingston upon Thames (Mr. Lamont), when he announced the imposition of VAT on domestic fuel in the same year, 1994–95, said that the sum that he envisaged obtaining in that year from that imposition was £950 million.
That is a measure of the folly of the Government's proposals. They will spend an extra £1·15 billion on privatisating the railways, which is in excess of the amount that they will obtain from the most unpopular tax proposed to Parliament since the poll tax. It is phenomenal testimony to dogma that in the present economic climate the Government seriously propose, as testified in the documents and as tacitly confirmed by the Minister tonight, to increase the taxpayers' subsidy to pay for privatisation by a sum greater than that they expect to collect from VAT on domestic fuel in 1994–95. That is absolutely astonishing and the equation will be noted with great interest outside the House even if Conservative Members choose to shut their ears to it.
We are dealing here with the powers of the franchising director. The Minister has chosen to concentrate rather narrowly on the business of stations. The truth is that the franchising director is the buffer who is being put between the Government and the railway system. He will be the fall guy. In his interview yesterday, the Secretary of State said that various matters would be for the franchising director. Of course they will not. The franchising director is the invention of Government and he will be their creature. The franchising director will follow precisely the political guidelines laid down by the Government.
We see the truth of the matter in the issue of stations. The franchising director is not an independent creature who can franchise our stations. He has already been told that the 13 biggest stations in the country will be disposed of privately on long leases. They will be taken out of the general area of railway franchises. It is no surprise to anyone who knows the people with whom we are dealing and their philosophy that these are not the 13 poorest and most undeveloped stations. They are not the regional railway stations which have been starved of investment. They are the most prosperous stations into which taxpayers' money has already been poured and, of course, they are the stations in which the private sector is already fully represented. They are the places where the work has already been done and on which the money has already been spent, so they are in a fit condition to be handed over to private operators who can skim profits off them.
I do not believe that the private operators whom the Minister and the Secretary of State have in mind will be interested in the revenue that comes from boring things, such as trains, using the stations. There is limited revenue from that. I do not believe that they will be interested in a combination of trains and the existing retail outlets which contribute to the use of stations by passengers. Of course they are not interested in that. They will be interested in air space, which will include everything that can be covered

over—everything that can be used for commercial development, for retail development and for office development. If the Tories have their way, some areas will be turned into shopping malls.
I was interested in an article in the Evening Standard last week, which I am sure that the Minister has read. It was written by a former colleague of Conservative Members, Mr. Conal Gregory, who had some interesting thoughts on these matters. Mr. Conal Gregory should be an object lesson to Conservative Members. He used to represent the railway constituency of York. He no longer represents that railway constituency and I have no doubt that one of the reasons for his departure from the House was the Government's policy towards the railways.
What did Mr. Conal Gregory, who was heavily billed as a Tory railway and tourism expert, suggest about our great London stations? He suggested that the trains should be moved a mile up the tracks and that whole areas should be covered over and used as shopping malls. That is a bright suggestion and one that has been noted. I saw letters from consumer organisations which said that that was exactly what they had feared from rail privatisation and from the privatisation of stations. The great stations of King's Cross and Paddington, the two that were mentioned specifically, will not be run by people who are committed to the railway industry. They will not be run by people whose primary interest is transport. The great master plan of Ministers is that they will be leased for a hundred-odd years to commercial organisations whose only interest will be in maximising the profit from them.
There will be constant tension between the commercial interests of those operators and the transport interests of the train operators. In those circumstances, I would not bet on the transport interests prevailing for long. Anywhere else that that has been tried—notably the United States—the trains were pushed out, exactly as Mr. Conal Gregory, lately of the Conservative Benches, told us would happen.
There is a parallel with the bus industry. Conservative Members are like parrots when they stand up and tell us about the great successes of privatisation. Have any of them studied what has happened to the bus industry since it was privatised?

The Minister for Transport in London (Mr. Steve Norris): Yes.

Mr. Wilson: The Minister is welcome to tell us how many town centres he has visited where the first thing that the privatised operator did was sell off the bus station in the town centre for commercial gain. An awful lot more money can be made by selling off town centre property than by using it as a bus station. We have an exact parallel between that and what could happen with our great railway stations for which that fate is predicted.
I shall make a point that is peculiar to Glasgow, as I had discussions last week with the chairman of the Strathclyde passenger transport executive. As a result of public investment, Central station is now magnificent. As the Minister will be aware, every penny that went into the low-level station, which is part of the Argyll line, was paid for by local taxpayers through the Strathclyde passenger transport executive. One hundred per cent. of the trains that use that station are subsidised by it. The Strathclyde passenger transport executive subsidises 65 per cent. of the trains that use the high-level station.
Is the Minister seriously telling us that the Strathclyde passenger transport executive is now to subsidise a private train operator to pay charges to a private station operator for the privilege of using assets and facilities, which, on behalf of the local taxpayer, it has already financed?
Why do the Government have such contempt for taxpayers that they are prepared to see them conned and diddled in every way possible, paying again and again for the assets that they have financed in the first place?
Throughout the country there is an enormous range of qualities in station facilities. By and large, where InterCity has been in charge—there is money in the InterCity system —the public sector stations are good and have excellent facilities. The Minister may dispute that; he may despise anything that the public sector does, but the stations that the Government seek to franchise are good.
One example that was pointed out to me was the comparison between York and Chester. Both cities are the same size, but are on opposite sides of the country. York has an excellent station, which was financed through InterCity; Chester has a pathetic, rundown station because there is no money in the regional railways system. That is the problem. Until now, the railways were given £850 million of subsidy, not £2 billion. That is the contrast.
Where will the money come from? Will it come through Railtrack, through the franchising director or from the franchisees? Is there any guarantee that the stations that have been neglected until now will not continue to decline because of that fundamental lack of money in the system, as proposed by the Secretary of State?

Mrs. Dunwoody: I should like to draw my hon. Friend's attention to the fact that we have an even worse position in Crewe, where, for example, a small fortune is being spent by the taxpayer on maintaining the railway bridge, which is the only direct route used by all emergency vehicles between one half of my constituency and the other.
I am quite clear that no private developer will be prepared to spend the enormous amount of money that is required on that infrastructure. I am afraid that my constituents can look forward to a bleak future.

Mr. Wilson: Many Labour Members and, if they are honest with themselves, Conservative Members, could tell the same story. But we have a completely untested area, where we have no idea what the operator will be asked to pay via the franchising director to Railtrack. We have no idea what assets Railtrack will have. All we know is that it must make a profit. On that basis, we are asked to believe that there will be additional money in the system and that, as part of the franchises, station facilities will be improved. There is no guarantee of that. There is no doubt that private operators will see stations as halts. They will not see them as a crucial part of their responsibilities. I believe that we shall see further destaffing and not the development of facilities, to which the Minister pays lip service.
We now know more about the franchising director, as we have his draft objectives. The picture becomes clearer about how he will be used as the guard—the fall guy—for what Ministers impose on the railways. The franchising director does not yet know what he will have to charge. I think that the Minister can confirm that. The Minister says

that progress has been made on that, but freight is the easy part. Part of the constraint that is placed on the franchising director is precisely that freight is to travel for very little on the tracks because of the belated lip service to the idea of putting more freight on to the railways.
The difficult part, the part that Coopers and Lybrand has so far failed to address, is what the franchise operators will have to pay to the franchising director. Until that is known, the whole thing is simply a charade. The idea that there can be shadow franchises without the shadow franchisee knowing what the principal cost will be is nonsense. Yet already the Government have gone down that road by pressing ahead with the ludicrous and already discredited Gatwick Express experiment—not a shadow franchise, because nobody knows what the shadow franchisee is paying for the use of the tracks and signalling, which is clearly its major overhead.
Many of my hon. Friends wish to participate in the debate. They are concerned about stations and the maintenance depots, which are also covered by the amendment. They are concerned by the idea that the franchising director is a complete unknown quantity, and that the powers that have been given to him are unlikely to produce anything of the kind of railway system that we want to see.
The Opposition will oppose the powers, because we believe that the Minister is seeking to use the franchising director in that way. It is clear from what has happened in stations that the franchising director will not be an independent creature; he will be very much the creature of Government. That will become even clearer when the first few franchises are attempted. The franchising director will be told clearly how much of his budget will go to those private operations to get them up and running. That will be done with a blatant disregard to the interests of the network as a whole.
The idea that that will be the action of the franchising director acting independently, as opposed to acting politically on behalf of the Government who have created him, is something which, at this stage of the debate, should be exposed as pure myth and a fallacy.
We will vote on one of the amendments in order to signify our opposition to the whole system and recognise that the franchising director will not be an independent operator. When he acts against the interests of an integrated national rail network, he will be doing so exclusively in the name of the Government, as clearly presaged by the Bill.

Sir Teddy Taylor: I have only one brief point that I want to raise with the Minister in all the amendments.
It seems to me that clause 26(3)(c), as proposed in Lords amendment 42, was the most appropriate. I have endeavoured to play a constructive role in the Railways Bill. The Minister will confirm that, when I heard that the Government were in deep trouble about amendment 31, to which we shall come shortly, which concerns British Rail participating, I tried to propose a way of solving it all by suggesting that we say that no subsidised national operator, whether it be French, German, Italian or British, should be able to participate, which I thought was a helpful compromise. However, as the Minister will confirm, we discovered that a Euro-directive exists which prevents us from doing that, so it unfortunately fell by the wayside. I


hope that the Minister will at least pay tribute to the fact that I have endeavoured, so far as I can, to assist him throughout the proceedings of the Bill.
My question relates to the Fenchurch Street line and the relevance of 26(3)(b) to that. First, I should like to say that the Minister who opened the debate has done a great deal for Southend-on-Sea. He has travelled on the line himself, as I do—I was on it this morning. He has spoken to the passengers and to the staff and given the impression that, for the first time in years, there is a Minister wo is interested in one of the most important lines in commuter land—that between Southend-on-Sea and Fenchurch Street station. That busy line is known as the misery line because, as my right hon. Friend the Member for Southend, West (Mr. Channon) will confirm, the signalling in the station is older than me. [HON. MEMBERS: "No!"] It is possible. Over the years, our constituents have suffered a lamentably bad standard of service.
My right hon. Friend and I were delighted to be told some time ago that new signalling would be installed on the line. That was a great breakthrough because many of the delays result from breakdowns in the ancient signalling system. The Minister also gave us an assurance, when he visited Westcliffe station, that the new operator would be obliged, as part of the deal, to provide new trains on the line. We know that the Minister is an optimist, and it may be that the serious economic situation has made that promise rather less than we hoped, but at least the thought was there, and we appreciate it.
The Minister has tried to bring hope to the commuters of Southend-on-Sea, who have suffered a great deal. Other places may have organisations that oppose rail privatisation, but that is not the case in Southend: we are looking to the future with some hope, as it could not be so bad as the past.

Mr. Bayley: Is not new rolling stock the one thing that would turn misery into joy on the line to Southend? Has the hon. Gentleman any idea whether privatisation would make it more or less likely that the commuters on his line would benefit in that way as people in Kent and other parts of Network SouthEast have recently been fortunate enough to do?

Sir Teddy Taylor: I can only say that the Minister told us—we were thrilled to hear him—as we were coming down from Westcliffe station that the new operator will bring in new trains. The line has never before had new trains. That promise may have to change because of the economic situation, but at least the thought was there, and we now have a much better chance of getting new trains. British Rail has told us that the best that we could hope for was 12-year-old trains. Although the staff are very nice, and British Rail has some delightful people, because of the system, and because of the priority given to the constituency of the hon. Member for Cunninghame, North (Mr. Wilson), the Southend constituencies have been sadly neglected.

Mr. Wilson: My constituency does rather well because a Labour council runs the Strathclyde passenger transport executive. Perhaps if Southend-on-Sea followed that example, it could share equally.
The hon. Gentleman said that nobody in Southend-on-Sea opposed privatisation. That rang a bell, and I dug up an interesting booklet called, "Rail Privatisation: a cause for concern". It lists various comments—from such radical

sources as the Daily Mail and The Daily Telegraph—which are deeply hostile to rail privatisation. Lo and behold, one of the sponsors of the booklet is the Southend-on-Sea rail users association. To give a general flavour, I will give the first comment in the booklet—from Lord Peyton, former Conservative Transport Minister—who said, "Absolutely dotty." Perhaps the hon. Gentleman should check his local information.

Sir Teddy Taylor: I do not want to take up too much time, but I assure the hon. Gentleman that I live in Southend-on-Sea, and I travel on the trains, as I did this morning. I am afraid that the hon. Gentleman is one of those chaps who speaks as an expert on everything. I know Southend. There was hostility, and my right hon. Friend the Member for Southend, West and I are well aware of that, but the Minister has taken a great deal of trouble. We have the promise of new signalling. It is unfortunate that I am being diverted when I am trying to make a simple and sensible point. I wish that the hon. Gentleman would not divert me.
My right hon. Friend will confirm that there is a far more positive feeling in Southend because of the trouble and the measures taken by the Minister, which we very much appreciate. If only other Ministers had the time and inclination to show the same consideration for difficult cases, we should get on better than we are. The hon. Member for Cunninghame, North should be aware that there are Labour councils on the Fenchurch Street line, but things do not get better or worse depending on the political complexion of the council through which the line travels, although in Southend-on-Sea things are usually better because the council is excellent.
My question arising from subsection (3)(c) concerns money. The Minister will be aware that, time and again in correspondence—I always get extremely courteous replies from him—I have asked him how the Southend to Fenchurch Street line is doing financially. My constituents have worries about fare charges, and they would be reassured if they knew the answer. If the amendment goes through, matters will be even more complicated, because the franchisee will have to take a lease on the offices, the railway station and the shops.
I have been the Member of Parliament for Southend, East for 13 years, and I have never yet found out whether the line pays for itself. My right hon. Friend the Member for Southend, West is even more conscientious than I, but he does not know either. The reason is that the accounts of British Rail are drawn up in a strange way. The busier a line is, the more overheads are imposed on it, so 10 passengers will result in more overheads than five. That is a busy line and could become even busier. We should like some idea of how it would perform if it were operated independently, or how it would perform now if overheads were not applied. The Minister has kindly said that he will let us know at an appropriate time. Could this be that appropriate time?
The Minister may say that he wants a trial period, with an independent operation in embryo form, to see how the line performs. That would give us an idea, but once we had got to that stage, we should be over the cliff. We would be there. We should like the Minister, British Rail, or anyone, to give us the information. We think that the line will


perform well. The fares are pretty high. Those on the line to Victoria are even higher because the service is better and there are sometimes nicer trains.
After all the Minister's generous concessions and offers to the hard-pressed travelling public of Southend-on-Sea, will he take the further step of giving us a broad idea of how the line performs financially? If it is a bad performer, running at a huge loss, our constituents, and even Lord Peyton, who is a nice chap, would be worried that the fares would rocket up and up, which would be terrible for us.
As the Minister is aware, Southend gets nothing from anyone. For example, we get nothing from the EC nonsense. Everywhere else round about gets money. We do not get Government grants. We were to get something under what is called assisted area status, but unfortunately a man called Mr. Van Miert decided to take 1 per cent. off the budget, and that included Southend-on-Sea. We do not take a penny from the Government. We are the prime example of Conservative capitalism. We try hard to co-operate with everything, but we want a good train service. Unemployment is high and people can sometimes find employment in London, but for that they need a reasonable service at a reasonable cost.
My right hon. Friend the Member for Southend, West and I greatly appreciate the Minister's efforts, and the time that he has taken. He has gone out of his way to answer our problems and questions and to speak to passengers and staff. However, there is a gap. We should like him to give us some idea how the line performs financially. If he cannot do that tonight, will he tell us at the appropriate time? When would be the appropriate time? It was not last year or the year before, six months ago or last week—I tried again last week. If he cannot give us a general idea, will he at least give some reassurance to the good people of Southend by telling us when the appropriate time would be?
I can assure the Minister that that is the only question that I want to raise. Southend-on-Sea is, by and large, far less apprehensive than other places about privatisation, and some are looking forward to it. We hope that it will bring better service.

Mr. Paul Channon: Does my hon. Friend agree that, although there has been a welcome improvement in the Southend line during the past year, the history of the line leads many to believe that it may be a good thing if the line is put into other hands than those of British Rail? Those other hands may well give a better service to our constituents.
Does my hon. Friend also agree that the Minister has on many occasions given assurances about the level of fares and that it would be helpful if the Minister would repeat those assurances? Is my hon. Friend aware that I strongly support him in his belief that we ought to know what the financial arrangements are on the line which, I believe, makes a profit?

Sir Teddy Taylor: I also think that it would be a help if we knew the figures. My right hon. Friend and I have acted as a genuine popular front on the matter, fighting together vociferously and toughly in the interests of our commuters. We hope that the Minister will therefore give a reply on the vital issues to the two hon. Members who represent Southend. We assure him that, if he does reply,

we shall simply sit back and believe that the privatisation exercise will give a good deal to the commuters of Southend. I hope that the Minister will give us the guidance that we are looking for, and will fill the one tiny gap in the great efforts that he has made for us until now.

8 pm

Ms Glenda Jackson: There are essentially just two subjects on which I would like the Minister to comment. First, who will have the responsibility for stations post-privatisation? Is it incumbent upon the franchising director to insist that a company which wishes, for example, to manage a stretch of stations along a particular line—although the company will not run trains upon that line—will have to ensure that those stations are manned?
The north London line runs through part of my constituency and is, I believe, now totally unmanned at stations. If part of the thrust of the Bill is to increase the use of existing rail networks and expand the use of trains throughout the day and beyond the rush hours—as is particularly the case in London and the south-east—that is a vain hope if the Minister and the Government cannot guarantee that stations will be manned.
The rejection of rail transport because of that aspect is not limited to women, who clearly dislike travelling late at night and having to wait on long and empty station platforms where there are no staff within eyesight or earshot. The impact is also grave for the disabled, whose ability to move around their country and community is excessively limited if there is no one at a station to assist them in alighting or mounting a train.
Who will have the responsibility for stations? Will there be a two-tier system of station facilities depending on which company's train one is travelling on? My hon. Friend the Member for Cunningham, North (Mr. Wilson) referred to InterCity. There are stations which presumably must facilitate passengers travelling by InterCity or on rural and local networks.
Will that mean that, if one travels by InterCity, one will be able to use all the facilities provided—waiting rooms, cafes, restaurants, lavatories and such shops as are available? I am excluding from that inquiry the large stations and terminuses which are clearly attractive to anyone who wishes to run a retail outlet or an office. I have a slight concern that it may at some point be impossible for passengers to catch a train, as there will be so many people on the major station concourses buying knickers, ties, pain au chocolat and coffee to take away.
If I were to join a rural train at a station where the majority of the finance has gone into the station infrastructure, will I be denied the use of the public lavatories, waiting rooms or refreshment facilities? Are we looking at the possibility of a two-tier or even a three-tier system for station networks?
My overriding concern is that there is an increasing movement towards the unmanned stations. That seems to cut directly at what the Government claim to be the main thrust in the privatisation of British Rail—to attract more and more passengers to service outside rush hours.

Mr. John Denham: The Minister said that amendment No. 5 refers to the powers of the franchising director over other railway assets. Those will include maintenance depots and—although it may not be the Government's intention at the moment—British


Rail Maintenance Ltd. at Eastleigh. The company is an important employer, and although it is not in my consituency, it employs several hundred of my constituents.
I believe that the powers that the Bill will give the Secretary of State and the franchising director pose a serious and severe threat to the future of BRML in Eastleigh and to the hundreds of my constituents who work there.
The achievements of BRML are well known locally. It employs just under 1,350 people, and it has of course had a significant reduction in employment during recent years, because the technology and the demands of the railway system have changed. Nonetheless, BRML is a major industrial employer. Productivity at BRML, and its contribution to the activities of British Rail, has increased significantly. The company is—within the structured competitive framework of an integrated railway system —profitable, and that is important.
The company is marked by good industrial relations. The most important aspect for the workers at BRML is its long-term commitment to the quality of its work and the undoubted contribution that it makes to safety on the railway system, and Network SouthEast—its major customer—in particular. It is obviously of local concern that, through BRML, about £24 million a year is brought into the economy of the Southampton area.

Mr. Deputy Speaker (Mr. Michael Morris): Order. I do not think that the whole history of BRML can be covered under the selection of amendments. The hon. Gentleman must relate his remarks to some of the amendments, which are concerned with miscellaneous franchising matters.

Mr. Denham: Amendment No. 5 amends the clause that refers to the duties of the franchising director in relation to the operation of additional railway assets. I understand that the amendment and the Minister's comments mean that to include the possible franchising of maintenance depots.
It is clear that the Minister does not intend under the Government's policy to include BRML in franchising. However, as I understand it, it is quite possible for BRML to be franchised under the Bill just as the level 4 depots are to be franchised. With respect, Mr. Deputy Speaker, I believe that the effect of the Bill on the potential franchising of BRML is an issue of great significance.

Mr. Freeman: I am sorry if I was in any way ambiguous. I stated that the group of amendments dealt with stations and light maintenance depots. That does not include BRML or the heavy maintenance depots, which are totally outwith the activities of the franchising director.

Mr. Denham: Will the Minister clarify whether he is saying that the amendment to the Bill does not include BRML, or is he merely saying that it is not the Government's intention to include BRML within the franchising process?
I am willing to be corrected, but I believe that, under the Bill as amended, it would be quite within the powers of the Secretary of State and the franchising director to franchise the operations of BRML. It might not be the Minister's intention to franchise, but surely the House is dealing with

the Bill as it is before us and as amended. The House is not dealing with what the Government might happen to do with the Bill if it were passed.

Mr. Freeman: I have already explained the subject, but obviously I failed to make the point. The group of amendments deals only with stations and light maintenance depots. I have defined what that means, and it specifically excludes heavy maintenance depots such as BRML. Those involve a separate policy issue, and the franchising director will have no direct responsibility for the ultimate movement into the private sector of BRML. That has nothing to do with franchising.

Mr. Denham: rose—

Mr. Deputy Speaker: Order. The hon. Gentleman had better try a little harder if he wants to bring his speech within order.

Mr. Denham: I bow to the Minister's interpretation, although that is not my understanding of the Bill. The Minister accepts that the Bill covers the light maintenance depots. If franchised as part of the development of the franchising system, those depots will be given powers to expand their operations and compete for the work currently done by works such as BRML at Eastleigh. Therefore, the effect of the legislation is, indeed, to put a potential threat over the 1,350 jobs at Eastleigh and the total £24 million contribution of BRML to the local economy.
At this point, as we extend or clarify the role of the franchising director, I question the failure of the Minister to take into account the implications of the policy on other parts of the rail network, and in particular on the safety and quality of operations undertaken by maintenance depots, including BRML, and the future of that work. I believe that the powers which the Government are taking under the amendment pose a threat to both my local railway works and the quality and safety of operations on the railway system.
The Government's approach to the franchising of maintenance depots is mistaken. It is a view widely shared in my area that those who currently provide maintenance services in the railway system and who may well lose that work under the new arrangements have been left as an afterthought or after-afterthought in the preparation for rail privatisation. That is not an adequate approach to an important rail maintenance facility and engineering works in the Southampton area.
In Committee, I asked the Minister whether it would be possible under the franchising arrangements to link BRML to one of the operating companies that would take over the operation of Network SouthEast activities. Network SouthEast is by far the largest customer of BRML. I also asked whether it would be possible to link the works directly with the leasing companies which are to be established for the provision of rolling stock.
I do not have the quotation with me, but I believe that my memory is correct on this point. In Committee, the Minister did not rule out the possibility of grouping BRML with either a leasing company or one of the companies that would franchise rail services. It is a mistake that we have come so far and yet those options have still not been ruled out. It is clear to me that the best way of retaining the activities at BRML and ensuring that they are not undercut by the franchises which are under discussion in the


amendment would be to make that engineering works an integral part either of one of the franchise operators or of one of the leasing companies.
I know that discussions have taken place between the trade unions, the local council and Ministers on the matter. I know that certain liaison arrangements have been reached and that the possibility of negotiating contracts has been discussed, but a short-term guarantee of work for BRML would not be sufficient.
If the Government push ahead with their wider proposals, a structured approach which builds that maintenance depot into one of the leasing companies will be required. In that way, the expertise of the work force and their contribution to the quality and safety of the rail system can be maintained. I hope that, even at this late stage, the Minister might give some undertaking that he will implement that option and ensure that possibly half or more of the 1,350 jobs in Eastleigh are not lost.

Mr. Tim Rathbone: I should like to raise three matters with my right hon. Friend the Minister. Before doing so, may I add to the comments made by my right hon. Friend the Member for Southend, West (Mr. Channon) and my hon. Friend for Southend, East (Sir T. Taylor) and echo their thanks to the Minister for his consideration in listening to the points made and for spending an awful lot of time in our part of the country down in Sussex, as he has done elsewhere. He studied the track and the operations and listened to people's concerns. Not only I but all local Sussex Members and local travellers in Sussex are immensely grateful to him for that.
My three questions relate to the operation of stations. First, how will the station leases be operated? It will not be outside the Minister's own experience that the British Rail Property Board can be somewhat conservative in its attitude to real estate development. Over the years, it has held up the clarification of extremely important developments in the county town of Lewes, which I am proud to represent. I hope that hard-edged commercial know-how and push will be injected into the disposal of the leases on the stations to which the Minister referred.
Secondly, can the Minister give reassurances yet again about closures? It would be good to hear a reassurance from my hon. Friend that when a lease on a station has been sold off, it will not be open to the lessee to close that station with greater facility than that which British Rail can close stations at present. I think that I am right in believing that exactly the same closure requirements will be established in the future as in the past, but it would be good to have that reassurance.
Thirdly, it would be good to have a reassurance that, in the development of stations, especially in towns and villages in the countryside the planning laws will be applied, monstrosities will not be put up and changes will not be made to structures which, if not listed as of historical value, are a loved part of the character of the towns and villages in which they have long been located. I hope that the Minister can give reassurances on those points. I should be grateful if he would do so.

Mr. Snape: I congratulate the hon. Member for Lewes (Mr. Rathbone) on the succinct and relevant points that he has just made. We shall all listen with interest to the Minister's reply.
I reiterate the comments made by my hon. Friend the Member for Southampton, Itchen (Mr. Denham) about the future of light maintenance depots. I am not sure whether Saltley depot near Birmingham falls into that category, but I suspect that it does. It was featured in a recent issue of Railnews, the staff magazine of what is left of British Rail. The article said that the depot provided a vital service to various sectors of British Rail in the Birmingham area—for example, it refuels hundreds of locomotives each working month.
It worries me that if depots such as Saltley are disposed of by the franchising director regardless of their operational necessity, they might be so disposed of because of their value on the property market—always supposing that the property market ever picks up again under the present Administration. The people who work at such depots would appreciate some assurance from the Minister that safeguards will be provided to ensure that the franchising director cannot dispose of useful operational assets solely for their property value.
In passing, I wish to reflect on the line to Southend. I listened with interest to the comments of the hon. Member for Southend, East (Sir T. Taylor). He made his customary passionate defence of the interests of his constituents. I do not complain about it. I commend him on it. Unfortunately, the London-Tilbury-Southend line was modernised before it became part of the London midland and Scottish empire. To demonstrate to the southerners that the London-Tilbury-Southend line was sound, it was electrified and resignalled to the highest possible standards many years ago. The problem is that, when so much of the Victorian signalling of British Rail still remains, lines such as London-Tilbury-Southend go the back of the queue when it comes to modernisation in later years.
The hon. Member for Southend, East specifically asked the Minister whether the London-Tilbury-Southend line was profitable. I am not sure whether the Minister, who answers most questions as ably as he possibly can, is in a position to answer that question. The hon. Gentleman might be aware that, under the Railways Act 1974, the financial performance of individual stretches of railway lines ceased to be compiled—in my view, it was a fairly inexact science before the 1974 Act came into force—and the overall subsidy paid to British Rail since 1974 has swamped the sort of detailed information that the hon. Gentleman requested.
Under the terms of the amendments, it appears that the Minister might be in a position to answer that question some time in the future. Indeed, as far as the future of the London-Tilbury-Southend line is concerned, he might well say that it will be profitable.

Sir Teddy Taylor: indicated dissent.

Mr. Snape: The hon. Member for Southend, East will not get any more exact answer than that. If the London-Tilbury-Southend line is profitable, it is because the track and signalling costs have been stripped and given to Railtrack.
I hope that I do not have to convince the hon. Gentleman that carrying lots of passengers to London in the morning and taking them home again at night is not a profitable way


of tying up assets worth millions of pounds for 24 hours a day. Under the proposals, if the track and signalling are given to the regulator, the lines may well be profitable.
The hon. Gentleman did not commend the taxpayer generally and the public sector as a whole on providing new signalling on the London—Tilbury—Southend line. I do not think that he received a satisfactory reply from the Minister about the prospects for new rolling stock. Under existing ownership, I understand that 10-year-old or 12-year-old rolling stock is to be cascaded—that is the beloved word of senior management of British Rail—from other parts of the country. That may or may not fit the bill under the new arrangements, but I think that it is the best that the Minister will be able to promise.
I shall ask the Minister some specific questions about the main railway station in the west midlands, Birmingham New Street. He will be aware that, under the existing fragmented, albeit publicly owned, railway system, virtually every sector of British Rail, including Network SouthEast services, serves Birmingham New Street. That station is regarded as the rail crossroads of western Europe. It is possible, although not always convenient, to get from virtually anywhere in England, Scotland and Wales to anywhere else by changing at Birmingham. Surely it should worry the Minister that, under the terms of the amendments, it would be possible to flog off Birmingham New Street to the highest bidder.
My hon. Friend the Member for Hampstead and Highgate (Ms Jackson) referred to some of the commercial outlets at other railway stations. Under the current arrangements, it is possible to buy a whole range of commercial goods, including socks, ties, knickers, hot dogs, Coca-Cola, hamburgers and cheese rolls at outlets at Birmingham New Street. Under the wonderful system proposed, we will have separate booking offices for the different privatised companies.
Under this fragmented, albeit publicly owned, system, it is possible to imagine that there will be a while range of booking office windows at Birmingham New Street, like an airport check-in lounge. If we have such booking office windows and commercial outlets as well, and if the station is privately owned, it is not difficult to imagine the sort of chaos that could ensue. Under the present system, although one can buy a whole range of goods at Birmingham New Street if one wants to, one cannot travel from England's second city, Birmingham, to England's third city, Manchester, and back after 6 o'clock in the evening. It was Sir Bob Reid mark one who gave the reason for that. He said:
It is not our role or function to run trains that are desirable. It is our role and function to run trains that are profitable.
Under the brave new world of the privately owned railway, it is difficult to believe that such services will be restored and that once the station is sold to a private operator, the main concern of the operator will be the welfare and safe passage of rail passengers, as against the interests of the commercial outlets that already exist and those that the owner of Birmingham New Street will seek to attract in the future. I hope that the Minister can give me some reassurance on that matter.
I have a couple of other facts that the Minister should bear in mind. Although it is possible to drink Coca-Cola by the gallon at Birmingham New Street, it is possible to get to the toilets only if one pays lop for a platform ticket. Toilets on stations are not open around the clock, although the outlets often appear to be. Will the new owners be

compelled to provide the sort of lavatory facilities that we expect the public sector to provide, albeit at a price, under the present system, or will they be free to make as much money as possible commercially without worrying too much about the welfare or comfort of future passengers?

Mr. McAllion: I was delighted to hear that the Minister recently visited Southend and received a warm reception. I recommend that he revisit Southend next Friday when the civil service trade unions will be demonstrating in opposition to the Government's market-testing proposals. I am sure that he will receive an even warmer reception if he shows up at the Customs and Excise building next Friday.

Sir Teddy Taylor: Does the hon. Gentleman accept that Customs and Excise has won every one of its market tests and that is has won every proposal put out for tender? Therefore, does he accept that, far from Customs and Excise in Southend being a threat, it has shown that it is so efficient that no one else can beat it?

Mr. McAllion: If the hon. Gentleman really believes that, he should go to the meeting next Friday and explain his position to the civil service trade unions in Southend.
At least the Minister was honest when he said that the main purpose of the amendments is to deal with the Government's proposals for railway stations. I shall concentrate mainly on that. The Minister drew a distinction between what he called "large stations" and the remainder of the stations. He said that large stations were those that were on commercially valuable sites close to the centre of large cities. For example, 188,000 passengers pass through Victoria station in London every day, and the station has retail space of some 47,500 sq ft.
It is easy to understand why the private sector would be interested in obtaining a long-term lease for one of the large stations. People will be falling over each other to get their hands on such valuable property. I am sure that the Minister will have no problem in selling large stations to the private sector, but, by his own admission, he said that there are only about two dozen such stations around Britain.
There are 2,500 stations around Britain, so what about the other 2,476? Will the private sector be equally interested in them? The Minister must give us more details about the proposals that are likely to be put in place for the remainder of the stations in Britain, other than the large, valuable and strategically placed stations.
A number of key stations are more middle sized. I am referring to stations that might be described as having a substantial or significant commercial potential—I hope that we can at least agree on what we mean by "substantial" or "significant"—or those that are in important passenger centres. I understand that the private sector might be interested in those stations as well. Indeed, train operators might be interested in taking out franchises for such stations. Will all the remaining 2,476 stations be classed as middle-sized stations, or will some stations fall outside either those two categories?
What will happen to the very small stations which count passengers in hundreds rather than thousands, or possibly even less than hundreds? What will happen to stations that are located not just far from the centres of cities but far from the cities all together? For example, ScotRail has been put out to franchise as a single bid. Will ScotRail be required to take on the franchise for every existing railway


station in Scotland? If that is not a requirement, when it takes on the franchises for the services, will it be able to say that it is not interested in taking over some stations because they are too small, require too much investment and do not have enough passengers? Will it be able to say that in its commercial judgment those stations cannot be run properly?
Under the Government's proposals, what will happen to such stations? The Minister has not made that clear and I hope that when he replies to the debate he will mention the small stations that do not have commercial potential. Will train operators be required to take on such stations as part of their franchise? I understand that train operators will lease the station from Railtrack and will operate it for the same duration as the franchise for the train service. I also understand that franchises are to be for seven, 10 or 15 years.
Will an operator who is required to take on a station for, say, seven years make a significant investment in that station when, at the end of seven years, he may lose the franchise for the service and, therefore, for the station? Any train operator who is told that he has to take on 25, 30 or 40 small stations will not be prepared to invest in them if he has a franchise of only seven years.

Mr. Wilson: I am sure that my hon. Friend will remember that in Committee the Minister said dismissively that it would be ridiculous for the franchising director to lay down when lights were to be switched off at Basildon station—for Basildon, we can read anywhere else in the country. My hon. Friend will remember that, in Committee, the Opposition said that an operator who wanted to get rid of off-peak or inconvenient services could use power over stations as a powerful, manipulative weapon.

Mr. McAllion: My hon. Friend makes a valuable point. If an operator is required by his franchise to run a series of small rural stations, he may close them at 6 o'clock in the evening, thus making it unnecessary to stop at them. Such services could be completely undermined by the franchisee, who would have the power to say that the stations would not be kept open after a certain time at night. Will such matters be negotiated with the operator, will there be give and take, or will the franchiser be able to agree with the franchisee about closing stations because no one is prepared to take them on?
I should like a reassurance that the two stations in my constituency, Dundee Central and Broughty Ferry, will be required to be kept open by whoever takes over the ScotRail franchise or the east coast main line franchise, the only two services which run through there. A train operator who takes on a franchise for any station will also be required to meet agreed and specified responsibilities on routine maintenance at the station. Will a train operator who is running the service to make a profit be interested in taking on the routine maintenance of an isolated small rural station? I do not think so.
Will there be an independent station operator, separate from the train operator and from Railtrack, for large stations? In the consultation document which was issued on this matter, the Minister states:

It is vital that there is a single chain of command to deal with emergencies, and this will be a requirement of the station operators safety case. The station operator will have to demonstrate to the Regulator that he has the management capacity to operate a station efficiently and safely. As part of this process he will need to prepare a satisfactory safety case.
Is there not a danger that the people who are best placed to exploit the commercial trading potential of a station—for example, Hanson or Marks and Spencer—may not be the best people to whom to give the responsibility for the safe operation of that station? Conversely, if the franchise is given to those who are best qualified to run the station safely, they may not be the best people to make the most money out of the station. Under the Government's proposals it is not impossible to surmise that Group 4 will bid for the operation of a large railway station, and that would not be regarded by anyone as a welcome development.
The cost of operating a station could be recouped by means of the charges that are placed on operators and others who use the station. If a station operator passes his costs on to the train operators who are using the station, the train operators will simply pass the costs to the customers, the fare-paying travellers. That is why some Conservative Members have spoken about assurances that there will be no implications for fare rises. Such an assurance is essential.
Lords amendment No. 37, which is not in this group, deletes clause 25(4), which states:
A franchise agreement may include provisions with respect to the fares to be charged to persons using the franchised services.
Therefore, the Minister is removing from the franchise agreement the ability of the franchiser to say that fares cannot be increased beyond a certain level. That seems to be giving freedom to those who operate the services and those who operate the stations to charge whatever they like to ensure profits, irrespective of what that may mean for people using the stations, their services and the trains that run through them.

Mr. Gunnell: I have some questions about clause 5, which deals with the general duties of the franchising director. Those duties were illuminated by the advice and objectives that were sent by the Secretary of State to the franchising director. That fits fully into the part of the Bill that we seek to amend. Subsection (1)(b) states that any payments to which the paragraph applies will have to achieve those objectives "economically and efficiently". The franchising director will have to assume that the person who receives the franchise will achieve any objectives given to him by the Secretary of State economically and efficiently. Those objectives have been spelt out.
I presume that the term "economically" applies to the person who is willing to bid the most to take on the job; therefore, it is about how much income there will be. From whose perspective will efficiency be considered? The efficiency of the train operator is clearly important, but it is slightly different from the passengers' view of efficiency. The operator will want to get his passengers dealt with as efficiently as possible, but facilities are important to the passenger, as hon. Members have said.
What guidance will be given to those who take on the franchises of stations on what should be provided for the benefit of passengers? Uniformity of service will be valuable. That is not to say that stations should have a


uniform appearance or should apply a uniform total service. However, one would expect a minimum level of service in all stations.
Hon. Members will be concerned about parking arrangements at stations. I am sure that they have noted that our passes for British Rail, which sometimes affect the efficiency of our travel arrangements, expire on 31 March next year. What advice will be given, through the franchising director, on the minimum level of service that passengers can expect? How will the different needs of operators, expecially muliple operators, be reconciled? I am concerned about the definition of "efficiency" when applied to the franchising of stations.
The Minister has sent out a wider consultation note. Bids are to be judged on efficiency and economy. We know a great deal about British Rail's unique position, a matter that we shall discuss shortly. If I have interpreted the Minister's consultation note correctly, it appears that British Rail's actual record will be given great weight. I presume that that record, as described in the general duties and objectives set for the franchising director, would include the sort of information referred to by the hon. Member for Southend, East (Sir T. Taylor).
It would be necessary to know the cost of providing services, adjusted to take account of the new financial and charging arrangements. Can I assume from the paragraph headed "The transfer of risk" that any private sector operator's bid cannot be comparable with that of British Rail because the risk will have been transferred from the public sector to the private sector?
The consultation note contains a fair amount on investment and what, under the general duties of the franchising director, the Secretary of State expects in investment. The Minister is aware that I am especially concerned about investment in rolling stock. Throughout the summer I have raised with him and his Department the question of moving forward the ordering of rolling stock for the newly electrified West Yorkshire line. The cascading process, which hon. Members have referred to and defined, is occurring in West Yorkshire and old rolling stock is to be refurbished at a cost of more than £3 million.
When the franchising director takes up his post, what initiatives can he take to ensure that there is investment and that the ordering of rolling stock is proceeded with? I pay tribute to the Minister for his efforts—with others, with myself, with the company concerned and with the West Yorkshire PTA—to solve the dilemma of how to push forward the current rolling stock order. It is significant that, under the Bill, even the Minister's best efforts—it is clear that he has made considerable effort—could not solve the problem. I want to know how the franchising director, under the general duties laid down for him, can break the impasse in West Yorkshire which is hindering the private sector railway engineering industry in doing its job and thriving.

Dr. Marek: I was recently in the constituency of my hon. Friend the Member for Morley and Leeds, South (Mr. Gunnell) and I noted the number of class 142s at Leeds station. They are most unsatisfactory vehicles and I sympathise with my hon. Friend because his whole region has them in and around it. Other regions have managed to get rid of them.
We must not forget that stations exist to help passengers to go about their business—from where they want to start to where they want to finish. A station does not exist as an

end in itself; it is something that helps passengers. It may be true that facilities are needed on stations as people should be able to buy tickets and refreshments and to obtain information. However, there is a line to be drawn between that sort of provision and turning stations into shopping malls, markets and places where developers and others with capital seek to make a return on that capital, irrespective of whether that helps the passenger to go about his business.
8.45 pm
There is a danger that stations could be so built up and clogged up that during busy times passengers could be impeded. Victoria station, although a little better now, was like that. It has always been claustrophobic on the high numbered platforms because there are too many shops. I do not blame British Rail, because it has to get money from wherever it can under the present system, but it has allowed too many shops. When the Bill becomes an Act, as I fear it will, and private interests take over stations, the criterion under which they operate will not be that of seeking to aid the passenger to go about his business.
There is already a nonsensical position under which Regional Railways does not want to pay to stop at one platform but might pay to stop at another platform; InterCity does not want to stop at one platform but will stop at another, provided that it is for no longer than is absolutely necessary. The convenience of the passenger does not come into play when it comes to trains stopping at stations, especially where passengers want to make connections.
Once a station is in private hands, different charges can be made for different trains to stop at different times on different platforms. The market, which the Government think knows best, might know what is best for the market and for those who want to make money out of passengers, but that might not be the same as providing the best possible service with the least inconvenience to passengers. I am worried about what the Government are doing through the clause. I shall wait and see what happens.
There will come a time when there is a different Administration. This incompetent Government are on their last legs because they have introduced such stupid Bills —[Interruption.] The Minister for Transport in London laughs, but the public know that they were had in 1992. People will not forget that the Government said, "Vote Conservative on 9 April and the recovery will begin on 10 April." People in my constituency have certainly not forgotten that.
When the Opposition are in government, I hope that we will take as our criterion the convenience of passengers. If any clause in any lease goes against the spirit of that criterion, we should either introduce legislation to take away such leases—without allowing the lessees to make any gain—or impose conditions on those leases to ensure that certain criteria are met; in that way, passengers could conveniently change trains and have convenient access to or exit from stations. If, at a suitable time, the Opposition can lay down those criteria clearly and succinctly, that will give pause for thought to any get-rich-quick cowboy developer or speculator whom the Government have in mind to take over the stations once the Bill becomes an Act.

Mr. Freeman: I shall seek to answer the points that have been raised.
The hon. Member for Cunninghame, North (Mr. Wilson) mentioned a number of issues, which I shall take in sequence. First, he referred to the possibility of double payment by, for example, local authorities or PTE authorities, for the use of stations where they had in the past been responsible for investing and improving the station facilities. I pay tribute to what the PTEs have done. Strathclyde was cited as an example where there has been sustained investment in rolling stock and I hope sincerely that that continues. The Strathclyde PTE—

Mr. Prescott: The Strathclyde authority.

Mr. Freeman: The Strathclyde authority will have my continued support in ensuring that it can place further orders for rolling stock, which I know that it is negotiating.

Mr. Prescott: At least it is not the Minister's money.

Mr. Freeman: It is the taxpayers' money.
I shall now reply to the argument that was made about investment in station assets. We are ensuring that, when the PTEs fund infrastructure improvements from debt they have incurred on their own books, they will not have to pay twice—the financing costs of the debt and also infrastructure charges. We intend that Railtrack will create an obligation on its books and repay the PTE, over a suitable period, sufficient funds to enable those additional charges for the use of assets to be financed by the local authorities. When we discuss the group of amendments about PTEs I will be glad to explain the arrangements that we have in mind.
The hon. Member for Cunninghame, North also asked where the money is to come from for stations. Railtrack is the freeholder and will have ultimate responsibility for all the assets that it owns. It may be that, for franchises where there is responsibility over five, seven or 10 years for running trains on a group of lines and the franchisee wants responsibility for operating and managing the stations, an agreement will be made with the franchisee as to what improvements, repairs and maintenance will be done at the stations. The responsibility will not fall between the two—in other words, on neither Railtrack nor the franchisee.
The hon. Gentleman asked me about allocation of cost to the shadow franchises. From 1 April 1994, with Railtrack established, the 25 train-operating companies will have a proper apportionment made of the cost of track. We hope to have financial information generated properly for the first seven franchises that we have nominated, from 1 April 1994, in a form which provides a true and accurate record of the cost of operating trains on those lines.
My hon. Friend the Member for Southend, East (Sir T. Taylor) asked me many questions. I can now be more precise about when financial information will be available about the Fenchurch Street line—the London, Tilbury and Southend line—because we intend that it should be shadow running from 1 April 1994, and that therefore, after the first six months, properly prepared financial information will be available. We shall know what the track charges are; we shall know what the operating costs are because we shall know the size of the payroll; we shall know which rolling stock is being used and accurate information will become available. It certainly will be

available in 1995–96 to the potential franchisees of the line, and I would expect that we shall start franchising that line in early 1995.
Therefore, when the hon. Gentleman tables a question asking me what has been the financial record of the line, I shall be able to answer in due corse, although certainly not before the first six months of the line, and, I would expect more accurately at the end of the financial year because when the franchising director lets the franchise that will be public information. In other words, the degree of subsidy required will be publicly known. I hope that that is a clear answer. My right hon. Friend the Member for Southend, West (Mr. Channon) and my hon. Friend the Member for Southend, East are interested in the line and we can see whether it is profitable.
I believe and expect that some fares on the London, Tilbury and Southend line will be reduced.

Sir Teddy Taylor: Hear, hear.

Mr. Freeman: I expect that franchisees for certain off-peak services will experiment with lower fares to increase patronage. I travel on the line in both peak and off peak and I know that there is a capacity available on the line. I would expect the private sector to experiment accordingly.
The hon. Member for Hampstead and Highgate (Ms Jackson) asked me about the manning of stations. I know that she is especially concerned about that, and she is right to be so. British Rail, over the years, has felt constrained by the limitation of its resources—inevitably, in the public sector—to reduce the manning at certain stations.
I would expect that, when we franchise rail services, there will be an improvement in the situation of stations which are either unmanned or partially manned, for two reasons. First I would expect the franchisees, and certainly Railtrack, to experiment with introducing greater commercial activity at some stations. Even quite small stations can benefit from shops, or perhaps even restaurant facilities. [Laughter.] The hon. Member for West Bromwich, East (Mr. Snape) laughs. Let me explain why British Rail cannot do that at the present time.
The hon. Gentleman has not had the experience of setting BR's external financing limit. That is broken down by line of route. The managers have a sum to spend—not a penny more, not a penny less. Many managers find it difficult to experiment, for example, with rent-free accommodation in order to attract the private sector, in what has been a depressed property market, to come on to the stations to develop them. I expect that, as one of the advantages of privatisation, the private sector, without those constraints, will experiment to create more activity at the stations. More activity means greater safety, and greater safety means more passengers.

Mr. Wilson: I am interested in the scenario which the Minister outlines, as it is imaginative and it may happen somewhere. His idea is that restaurants will be opened at stations which are currently unmanned in order to attract more people on to the stations while trains which are under-used run through them. It may happen, but I am sure that the Minister will also want to consider the scenario that I mentioned to my hon. Friend the Member for Dundee, East (Mr. McAllion) and which the Minister brought into the debate in Committee.
He made it quite clear that it would not be the Minister's or the franchise director's job to lay down the times when


there would have to be lights on stations, far less a range of restaurants available to the public on a rent-free basis. Will the Minister consider that other scenario, and will he confirm that it will be at the discretion of the operator, not just whether there are restaurants on the stations where now there are none, but whether there are lights on in the stations and whether the operator of the stations and the route will be allowed to run down the service to get rid of off-peak services?

Mr. Freeman: The hon. Gentleman proceeds from the assumption that the private sector is there to cream off the profits, make the service deteriorate, increase fares substantially and cut investment. I do not proceed on that basis. All the evidence of privatisations during the past 14 years flies in the face of his assertion. I do not expect the private sector to do anything other than encourage more passengers to use railway trains. That will perhaps answer the hon. Member for Morley and Leeds, South (Mr. Gunnell). The rooted hostility of the hon. Member for Cunninghame, North towards the private sector is irrational. I expect it to want more patronage, not less.
I was in the middle of trying to answer the hon. Member for Hampstead and Highgate. In certain cases, the private sector will want to experiment to encourage patronage, by hiring additional staff to work on platforms or on trains. I believe that Network SouthEast has lost a share of the market—although I do not blame it—because it has had to operate within cash limits under Labour and Conservative Governments, as I have described. There is evidence, however, that more people would travel by train if they felt that they were more secure—especially women late at night. I believe that such investment by the private sector would be repaid.
The hon. Member for Southampton, Itchen (Mr. Denham) asked about British Rail Maintenance Ltd. at Eastleigh. There has been a remarkable change in the technology involved in building trains. Whatever happens —whether British Rail is privatised or not—we must acknowledge that that change will reduce the amount of work available for heavy maintenance depots. We must face the fact that considerable surplus capacity is likely in that section of the industry. It is important that we do not limit the opportunities open to the workers at Eastleigh or the amount of business that they can bid for.
In Committee, I considered whether it was sensible to assign each BRML depot to one of the rolling stock leasing companies. I have come to the firm conclusion—one that I think is shared by those who work at Eastleigh—that that would be wrong, because one would be limiting its work.

Mr. Denham: rose—

Mr. Freeman: I shall give way to the hon. Gentleman on that subject, but perhaps I may finish my argument first. Eastleigh would then be limited to perhaps only one third of the total rolling stock maintenance market. The more efficient the plant, the more business it can obtain, and if Eastleigh is right that it is one of the most efficient plants, as I believe it is, it should wish to bid for work from all the rolling stock companies.
The present arrangements are not satisfactory, because work is essentially assigned by British Rail. Eastleigh should have the opportunity to compete across the board. As the hon. Member for Itchen said, it is true that we plan to establish contracts between British Rail and Eastleigh—and probably the rolling stock leasing companies,

although not necessarily—to guarantee a work load for some years. I cannot be specific about how much and for how many years. Those contracts would ensure the viability of the business before it passes into the private sector.

Mr. Denham: Although it is perhaps a contradiction of what the Minister has just said, does he accept that last week the council and the trade unions representing workers from BRML asked that it be allocated to a leasing company? The evidence therefore suggests that BRML workers favour that option. Does the Minister also accept that 90 per cent. of its work derives from Network SouthEast rolling stock, largely because of the third rail electrification system, which means that it has a specific type of rolling stock and therefore of maintenance? The allocation of BRML to the leasing company most likely to provide such rolling stock would be the best way to secure its future.

9 pm

Mr. Freeman: We are dealing with the livelihoods of many people, and I am happy to keep an open mind on the final structure. I do not want to do anything that would needlessly put anyone's jobs in jeopardy. I have already given a commitment to my hon. Friend the Member for Eastleigh (Mr. Milligan)—I am happy to extend it to the hon. Gentleman—that I shall stay in close touch so that we do not needlessly complicate what is already a difficult situation due to the over-capacity in the industry. I hope that the hon. Gentleman will take those words in the spirit in which they are offered.
My hon. Friend the Member for Lewes (Mr. Rathbone) asked me three questions. I thank him for his kind comments. I know of his great commitment, both in his constituency and throughout the south-east, to ensuring that we have a good railway system, and that services improve rather than deteriorate. First, he asked who would have responsibility for stations and for their maintenance, development and so forth. He asked whether it would be the British Rail Property Board or some other body.
Railtrack, as the freeholder, will be responsible for all stations and will decide when it is appropriate to delegate any financial responsibility to the franchisees, who will be responsible for maintenance and development for a relatively short period in the life of a station—five, seven or 10 years. I am already impressed with Railtrack's plans. A competent management is being put in place, and I look forward to Railtrack pursuing a positive policy to improve stations. I can assure my hon. Friend that the Secretary of State for Transport and I will watch carefully to see that that policy is applied.
I assure my hon. Friend, too, that the closure policy, which my hon. Friend the Minister for Transport in London will deal with shortly, will cover stations. Neither Railtrack nor a franchisee will be able to close a station precipitously. We set out at length our policy on that aspect. That process will take up to 12 months.
As to towns and villages having railway stations which might not be covered by listed building consents, I give my hon. Friend the assurance that planning law will continue to apply to any change of use away from the main business of the statutory undertaking—that is, running a railway station—to some other purpose, such as the running of a


supermarket. Listed building consent already applies and will continue to do so. We want to maintain our excellent railway stations, particularly those in Sussex.
The hon. Member for West Bromwich, East (Mr. Snape) asked about disposing of assets for commercial value. That will be the responsibility of Railtrack as the freeholder. As to Birmingham New Street, I see nothing wrong in having a single operator of that station being responsible for the station's commercial redevelopment and improvement, with several different franchisees operating through it. Birmingham New Street is already showing its age and I see no objection to a sole operator with many different train operators providing services.
The hon. Member for Leeds, East (Mr. Mudie) asked what is meant by the transfer of risk in the draft document which sets out the franchising director's objectives. It means that when the franchising director considers bids from the public and private sector, he will take into account that a public sector bid does not involve the transfer of risk. If the public sector gets its bid wrong and more subsidy is required, the taxpayer has to pay, so there may be some premium, advantage or benefit attached to a private sector bid which takes the risks.
I was asked about the role of the franchising director in West Yorkshire passenger transport executive rolling stock. He will be able to designate assets so that they roll over from one franchise to another. They will continue in use for the full length of a lease. The director will also be able to give assurances about the operation of the railway administration orders. I look forward to making further progress on the rolling stock lease. I am determined that it will come to fruition.

Mr. Andrew Welsh: The Minister dwelt on the commercial prospects for larger stations; but will he comment on the rule for smaller stations? How will his plans affect them? Will he answer the questions put by the hon. Member for Dundee, East (Mr. McAllion)? What future does the Minister see for smaller, rural stations?

Mr. Freeman: I apologise for not dealing with that point, which was also raised, by implication, by the hon. Member for Wrexham (Dr. Marek). Smaller stations will almost invariably be run by the franchisees and will remain under the ownership of Railtrack, the freeholder. It will not be within the gift of the franchisee operating the train services or Railtrack to close any particular station. We have an elaborate, clear and comprehensive closure procedure which involves not only the consultative committees but the regulator and my right hon. Friend the Secretary of State for Transport.

Mr. McAllion: The Minister said that smaller stations 
will almost invariably be run by the franchisees".
That suggests that ScotRail, for example, will be required to take on all the small rural stations in Scotland and continue to run them as part of the franchise that it assumes on 1 April. Will the Minister confirm that that is the case?

Mr. Freeman: I think that by implication that is the case, for the simple reason that when we come to franchise ScotRail, it will be franchised on the basis of all the rail services running in Scotland. By definition, that will involve the active use of all the stations, small and large,

at which rail services call. Therefore, the practical implication is yes. I commend the amendment to the House.

Amendment agreed to.

Lords amendment: No. 5, in page 6, line 5, at end insert
("or
((ii) the operation of additional railway assets under or by virtue of any franchise agreement or any provision of sections 26 and 32 to 42 below;").

Motion made, and Question proposed, That this House doth agree with the Lords in the said amendment.—[Mr. Freeman.]

Question put:—

The House divided: Ayes 319, Noes 231.

Division No. 379]
[9.09 pm


AYES


Ainsworth, Peter (East Surrey)
Coombs, Anthony (Wyre For'st)


Aitken, Jonathan
Coombs, Simon (Swindon)


Alexander, Richard
Cope, Rt Hon Sir John


Alison, Rt Hon Michael (Selby)
Cormack, Patrick


Allason, Rupert (Torbay)
Couchman, James


Amess, David
Cran, James


Ancram, Michael
Currie, Mrs Edwina (S D'by'ire)


Arbuthnot, James
Curry, David (Skipton & Ripon)


Arnold, Jacques (Gravesham)
Davies, Quentin (Stamford)


Ashby, David
Davis, David (Boothferry)


Aspinwall, Jack
Day, Stephen


Atkins, Robert
Deva, Nirj Joseph


Atkinson, David (Bour'mouth E)
Devlin, Tim


Atkinson, Peter (Hexham)
Dickens, Geoffrey


Baker, Rt Hon K. (Mole Valley)
Dicks, Terry


Baker, Nicholas (Dorset North)
Dorrell, Stephen


Baldry, Tony
Douglas-Hamilton, Lord James


Banks, Matthew (Southport)
Dover, Den


Bates, Michael
Duncan, Alan


Batiste, Spencer
Duncan-Smith, Iain


Bellingham, Henry
Dunn, Bob


Bendall, Vivian
Durant, Sir Anthony


Beresford, Sir Paul
Dykes, Hugh


Biffen, Rt Hon John
Eggar, Tim


Blackburn, Dr John G.
Elletson, Harold


Body, Sir Richard
Emery, Rt Hon Sir Peter


Bonsor, Sir Nicholas
Evans, David (Welwyn Hatfield)


Booth, Hartley
Evans, Jonathan (Brecon)


Boswell, Tim
Evans, Nigel (Ribble Valley)


Bottomley, Peter (Eltham)
Evans, Roger (Monmouth)


Bottomley, Rt Hon Virginia
Evennett, David


Bowden, Andrew
Faber, David


Bowis, John
Fabricant, Michael


Boyson, Rt Hon Sir Rhodes
Fairbaim, Sir Nicholas


Brandreth, Gyles
Fenner, Dame Peggy


Brazier, Julian
Field, Barry (Isle of Wight)


Bright, Graham
Fishburn, Dudley


Brooke, Rt Hon Peter
Forman, Nigel


Brown, M. (Brigg & Cl'thorpes)
Forsyth, Michael (Stirling)


Browning, Mrs. Angela
Forsythe, Clifford (Antrim S)


Bruce, Ian (S Dorset)
Forth, Eric


Budgen, Nicholas
Fowler, Rt Hon Sir Norman


Burns, Simon
Fox, Dr Liam (Woodspring)


Burt, Alistair
Fox, Sir Marcus (Shipley)


Butcher, John
Freeman, Rt Hon Roger


Butler, Peter
French, Douglas


Carlisle, John (Luton North)
Fry, Peter


Carlisle, Kenneth (Lincoln)
Gale, Roger


Carrington, Matthew
Gallie, Phil


Carttiss, Michael
Gardiner, Sir George


Cash, William
Garel-Jones, Rt Hon Tristan


Channon, Rt Hon Paul
Garnier, Edward


Chapman, Sydney
Gill, Christopher


Churchill, Mr
Gillan, Cheryl


Clappison, James
Goodlad, Rt Hon Alastair


Clarke, Rt Hon Kenneth (Ruclif)
Goodson-Wickes, Dr Charles


Clifton-Brown, Geoffrey
Gorman, Mrs Teresa


Coe, Sebastian
Gorst, John


Colvin, Michael
Grant, Sir A. (Cambs SW)


Congdon, David
Greenway, Harry (Ealing N)


Conway, Derek
Greenway, John (Ryedale)






Griffiths, Peter (Portsmouth, N)
Mayhew, Rt Hon Sir Patrick


Grylls, Sir Michael
Mellor, Rt Hon David


Gummer, Rt Hon John Selwyn
Merchant, Piers


Hague, William
Milligan, Stephen


Hamilton, Rt Hon Archie (Epsom)
Mills, Iain


Hanley, Jeremy
Mitchell, Andrew (Gedling)


Hannam, Sir John
Mitchell, Sir David (Hants NW)


Hargreaves, Andrew
Moate, Sir Roger


Harris, David
Molyneaux, Rt Hon James


Haselhurst, Alan
Monro, Sir Hector


Hawkins, Nick
Montgomery, Sir Fergus


Hawksley, Warren
Moss, Malcolm


Hayes, Jerry
Needham, Richard


Heald, Oliver
Nelson, Anthony


Heathcoat-Amory, David
Neubert, Sir Michael


Hendry, Charles
Newton, Rt Hon Tony


Heseltine, Rt Hon Michael
Nicholls, Patrick


Higgins, Rt Hon Sir Terence L.
Nicholson, David (Taunton)


Hill, James (Southampton Test)
Nicholson, Emma (Devon West)


Hogg, Rt Hon Douglas (G'tham)
Norris, Steve


Horam, John
Onslow, Rt Hon Sir Cranley


Hordern, Rt Hon Sir Peter
Oppenheim, Phillip


Howard, Rt Hon Michael
Ottaway, Richard


Howarth, Alan (Strat'rd-on-A)
Page, Richard


Howell, Rt Hon David (G'dford)
Paice, James


Howell, Sir Ralph (N Norfolk)
Patnick, Irvine


Hunt, Rt Hon David (Wirral W)
Patten, Rt Hon John


Hunt, Sir John (Ravensbourne)
Pawsey, James


Hunter, Andrew
Peacock, Mrs Elizabeth


Hurd, Rt Hon Douglas
Pickles, Eric


Jack, Michael
Porter, David (Waveney)


Jackson, Robert (Wantage)
Portillo, Rt Hon Michael


Jenkin, Bernard
Powell, William (Corby)


Jessel, Toby
Rathbone, Tim


Johnson Smith, Sir Geoffrey
Redwood, Rt Hon John


Jones, Gwilym (Cardiff N)
Renton, Rt Hon Tim


Jones, Robert B. (W Hertfdshr)
Richards, Rod


Jopling, Rt Hon Michael
Riddick, Graham


Kellett-Bowman, Dame Elaine
Rifkind, Rt Hon. Malcolm


Key, Robert
Robathan, Andrew


Kilfedder, Sir James
Roberts, Rt Hon Sir Wyn


King, Rt Hon Tom
Robertson, Raymond (Ab'd'n S)


Kirkhope, Timothy
Robinson, Mark (Somerton)


Knapman, Roger
Roe, Mrs Marion (Broxboume)


Knight, Mrs Angela (Erewash)
Ross, William (E Londonderry)


Knight, Greg (Derby N)
Rowe, Andrew (Mid Kent)


Knight, Dame Jill (Bir'm E'st'n)
Rumbold, Rt Hon Dame Angela


Knox, Sir David
Ryder, Rt Hon Richard


Kynoch, George (Kincardine)
Sackville, Tom


Lait, Mrs Jacqui
Sainsbury, Rt Hon Tim


Lang, Rt Hon Ian
Scott, Rt Hon Nicholas


Lawrence, Sir Ivan
Shaw, David (Dover)


Legg, Barry
Shaw, Sir Giles (Pudsey)


Leigh, Edward
Shephard, Rt Hon Gillian


Lennox-Boyd, Mark
Shepherd, Colin (Hereford)


Lester, Jim (Broxtowe)
Shersby, Michael


Lidington, David
Sims, Roger


Lightbown, David
Skeet, Sir Trevor


Lilley, Rt Hon Peter
Smith, Sir Dudley (Warwick)


Lloyd, Peter (Fareham)
Smith, Tim (Beaconsfield)


Lord, Michael
Soames, Nicholas


Luff, Peter
Spencer, Sir Derek


Lyell, Rt Hon Sir Nicholas
Spicer, Sir James (W Dorset)


MacGregor, Rt Hon John
Spicer, Michael (S Worcs)


MacKay, Andrew
Spink, Dr Robert


Maclean, David
Spring, Richard


McLoughlin, Patrick
Sproat, Iain


McNair-Wilson, Sir Patrick
Squire, Robin (Hornchurch)


Madel, David
Stanley, Rt Hon Sir John


Maitland, Lady Olga
Steen, Anthony


Major, Rt Hon John
Stephen, Michael


Malone, Gerald
Stern, Michael


Mans, Keith
Stewart, Allan


Marland, Paul
Streeter, Gary


Marlow, Tony
Sumberg, David


Marshall, John (Hendon S)
Sweeney, Walter


Marshall, Sir Michael (Arundel)
Sykes, John


Martin, David (Portsmouth S)
Tapsell, Sir Peter


Mates, Michael
Taylor, Ian (Esher)


Mawhinney, Dr Brian
Taylor, John M. (Solihull)





Taylor, Sir Teddy (Southend, E)
Ward, John


Temple-Morris, Peter
Wardle, Charles (Bexhill)


Thomason, Roy
Waterson, Nigel


Thompson, Sir Donald (C'er V)
Watts, John


Thompson, Patrick (Norwich N)
Wells, Bowen


Thornton, Sir Malcolm
Whitney, Ray


Thumham, Peter
Whittingdale, John


Townend, John (Bridlington)
Widdecombe, Ann


Townsend, Cyril D. (Bexl'yh'th)
Wiggin, Sir Jerry


Tracey, Richard
Wilkinson, John


Tredinnick, David
Willetts, David


Trend, Michael
Wilshire, David


Trimble, David
Winterton, Nicholas (Macc'fld)


Trotter, Neville
Wolfson, Mark


Twinn, Dr Ian
Yeo, Tim


Vaughan, Sir Gerard
Young, Rt Hon Sir George


Viggers, Peter



Waldegrave, Rt Hon William
Tellers for the Ayes:


Walker, A. Cecil (Belfast N)
Mr. Timothy Wood and


Walker, Bill (N Tayside)
Mr. Robert G. Hughes.


Waller, Gary



NOES


Abbott, Ms Diane
Denham, John


Adams, Mrs Irene
Dixon, Don


Ainger, Nick
Dobson, Frank


Ainsworth, Robert (Cov'try NE)
Donohoe, Brian H.


Alton, David
Dowd, Jim


Anderson, Donald (Swansea E)
Dunwoody, Mrs Gwyneth


Anderson, Ms Janet (Ros'dale)
Eagle, Ms Angela


Armstrong, Hilary
Enright, Derek


Ashton, Joe
Etherington, Bill


Barnes, Harry
Ewing, Mrs Margaret


Battle, John
Field, Frank (Birkenhead)


Bayley, Hugh
Flynn, Paul


Beckett, Rt Hon Margaret
Foster, Rt Hon Derek


Beith, Rt Hon A. J.
Foster, Don (Bath)


Benn, Rt Hon Tony
Fraser, John


Bennett, Andrew F.
Fyfe, Maria


Bermingham, Gerald
Galloway, George


Berry, Dr. Roger
Gapes, Mike


Betts, Clive
Garrett, John


Blair, Tony
George, Bruce


Blunkett, David
Gerrard, Neil


Boyes, Roland
Gilbert, Rt Hon Dr John


Bradley, Keith
Godman, Dr Norman A.


Bray, Dr Jeremy
Golding, Mrs Llin


Brown, Gordon (Dunfermline E)
Gordon, Mildred


Burden, Richard
Grant, Bernie (Tottenham)


Byers, Stephen
Griffiths, Nigel (Edinburgh S)


Callaghan, Jim
Gunnell, John


Campbell, Mrs Anne (C'bridge)
Hain, Peter


Campbell, Menzies (Fife NE)
Hall, Mike


Campbell, Ronnie (Blyth V)
Hanson, David


Campbell-Savours, D. N.
Hardy, Peter


Canavan, Dennis
Harman, Ms Harriet


Cann, Jamie
Harvey, Nick


Carlile, Alexander (Montgomry)
Hattersley, Rt Hon Roy


Chisholm, Malcolm
Heppell, John


Clark, Dr David (South Shields)
Hill, Keith (Streatham)


Clarke, Eric (Midlothian)
Hinchliffe, David


Clarke, Tom (Monklands W)
Hoey, Kate


Clwyd, Mrs Ann
Hogg, Norman (Cumbernauld)


Coffey, Ann
Home Robertson, John


Cohen, Harry
Hood, Jimmy


Connarty, Michael
Hoon, Geoffrey


Cook, Frank (Stockton N)
Hoyle, Doug


Corbett, Robin
Hughes, Kevin (Doncaster N)


Corbyn, Jeremy
Hughes, Roy (Newport E)


Corston, Ms Jean
Hutton, John


Cryer, Bob
Illsley, Eric


Cummings, John
Jackson, Glenda (H'stead)


Cunliffe, Lawrence
Jackson, Helen (Shef'ld, H)


Cunningham, Jim (Covy SE)
Jamieson, David


Dafis, Cynog
Janner, Greville


Darling, Alistair
Johnston, Sir Russell


Davidson, Ian
Jones, Barry (Alyn and D'side)


Davies, Rt Hon Denzil (Llanelli)
Jones, Jon Owen (Cardiff C)


Davies, Ron (Caerphilly)
Jones, Lynne (B'ham S O)


Davis, Terry (B'ham, H'dge H'l)
Jones, Martyn (Clwyd, SW)






Jones, Nigel (Cheltenham)
Pope, Greg


Jowell, Tessa
Powell, Ray (Ogmore)


Kaufman, Rt Hon Gerald
Prentice, Ms Bridget (Lew'm E)


Keen, Alan
Prentice, Gordon (Pendle)


Kennedy, Charles (Ross,C&S)
Prescott, John


Kennedy, Jane (Lpool Brdgn)
Primarolo, Dawn


Kilfoyle, Peter
Radice, Giles


Kinnock, Rt Hon Neil (Islwyn)
Randall, Stuart


Kirkwood, Archy
Raynsford, Nick


Leighton, Ron
Redmond, Martin


Lestor, Joan (Eccles)
Rendel, David


Lewis, Terry
Robertson, George (Hamilton)


Livingstone, Ken
Robinson, Peter (Belfast E)


Lloyd, Tony (Stretford)
Roche, Mrs. Barbara


Llwyd, Elfyn
Rogers, Allan


Loyden, Eddie
Rooker, Jeff


Lynne, Ms Liz
Rooney, Terry


McAllion, John
Ross, Ernie (Dundee W)


McAvoy, Thomas
Rowlands, Ted


McCartney, Ian
Ruddock, Joan


McCrea, Rev William
Sedgemore, Brian


Macdonald, Calum
Sheldon, Rt Hon Robert


McFall, John
Shore, Rt Hon Peter


McGrady, Eddie
Short, Clare


Mackinlay, Andrew
Simpson, Alan


McLeish, Henry
Skinner, Dennis


Maclennan, Robert
Smith, Andrew (Oxford E)


McNamara, Kevin
Smith, C. (Isl'ton S & F'sbury)


McWilliam, John
Smith, Llew (Blaenau Gwent)


Madden, Max
Snape, Peter


Maddock, Mrs Diana
Soley, Clive


Mahon, Alice
Spearing, Nigel


Mandelson, Peter
Squire, Rachel (Dunfermline W)


Marek, Dr John
Steinberg, Gerry


Marshall, David (Shettleston)
Stevenson, George


Marshall, Jim (Leicester, S)
Stott, Roger


Martlew, Eric
Strang, Dr. Gavin


Maxton, John
Taylor, Mrs Ann (Dewsbury)


Meacher, Michael
Taylor, Matthew (Truro)


Michael, Alun
Thompson, Jack (Wansbeck)


Michie, Mrs Ray (Argyll Bute)
Tipping, Paddy


Milburn, Alan
Tyler, Paul


Miller, Andrew
Walley, Joan


Mitchell, Austin (Gt Grimsby)
Wardell, Gareth (Gower)


Moonie, Dr Lewis
Wareing, Robert N


Morgan, Rhodri
Watson, Mike


Morley, Elliot
Welsh, Andrew


Morris, Rt Hon A. (Wy'nshawe)
Wicks, Malcolm


Morris, Estelle (B'ham Yardley)
Williams, Rt Hon Alan (Sw'n W)


Mowlam, Marjorie
Wilson, Brian


Mudie, George
Winnick, David


Mullin, Chris
Wise, Audrey


Oakes, Rt Hon Gordon
Worthington, Tony


O'Brien, Michael (N W'kshire)
Wray, Jimmy


O'Brien, William (Normanton)
Wright, Dr Tony


O'Hara, Edward
Young, David (Bolton SE)


Paisley, Rev Ian



Parry, Robert
Tellers for the Noes:


Patchett, Terry
Mr. Gordon McMaster and


Pickthall, Colin
Mr. Alan Meale.


Pike. Peter L.

Question accordingly agreed to.

Lords amendment: No. 6, in

page 6, line 20, after ("35") insert
("Proposals to close passenger railway facilities operated on behalf of the Franchising Director")

The Minister for Transport in London (Mr. Steve Norris): I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker (Mr. Michael Morris): With this, we will take Lords amendments Nos. 70, 71 to 123, 325, 326 and 453.

Mr. Norris: The amendments build on the existing closure procedures. Those procedures will apply, as at present, to the complete cessation of passenger services to

a station or on a line. Consumer committees will continue to report on any hardship arising from a proposed closure and may, of course, hold public hearings. Some changes will be made to the procedures, mainly to reflect the new structure of the railways. The operational control of certain facilities, networks, stations and light maintenance depots may not in future rest with train operators, so the closure procedures will also need to apply to proposals to terminate the use of such facilities. Decisions on closures will be for the regulator, but there will be a right of appeal to the Secretary of State. There will also be a simplified procedure for minor infrastructure closures.
The amendments would substantially improve the closure provisions of the Bill. The majority are drafting, technical and consequential amendments, but one or two are of substance. I emphasise that most of the proposals were tabled by Opposition Peers, or introduced by the Government in response to Opposition concerns. Let me detail the most significant of them.
Amendment No. 108 is the most important in the group. It removes the 26-week limit on any further period that the Secretary of State may allow the regulator to make his decision. We have repeatedly said that the restructuring of railways does not lead to more closures but, inevitably—as has always been known on the railways—there will be a few over time as railways adjust to changing demand, just as there will be additions to the network for the same reason. Most of the closures will not be particularly important but it is conceivable that there may be controversial closures and the closure procedures have to cater for that eventuality, too.
The Bill as drafted permits the regulator a maximum of one year in which to make his decision. It is acceptable to argue that, in an especially controversial case, that limit might be tested severely. Amendment No. 108 will remedy that potential difficulty.
Amendments Nos. 107, 112 and 325 would enable the rail users consultative committees to publish their reports to the regulator; would ensure that the RUCCs were informed of the designation by the franchising director of those services that were experimental; and would permit the Secretary of State to place conditions on consents to closure given under the alternative closure procedures set out in schedule 4. All those amendments followed representations made on behalf of the Central Transport Consultative Committee, and I am sure that hon. Members on both sides of the House will agree that they would improve the Bill.
Amendment No. 453 would make transitional provision for closure proposals—that is, provision for closure proposals which might be in the pipeline when the new procedures replace the old. It provides that such a proposal should be processed under the old procedure. It also ensures that the channel tunnel services are included in the consumer committees' responsibilities.
Amendments Nos. 97 and 104 introduce the new clauses that are needed to cover a particular circumstance in which a closure might be proposed that was not covered by the Bill as amended in this House. If consent to close a network or a facility such as a maintenance depot is refused, the franchising director must secure its continued operation, and is likely to do so by engaging someone to do it on his behalf. The new clauses will simply enable him to repropose closure of those networks or facilities if in later years he wishes to do so.
Other amendments in the group include a recasting of clause 33, which deals with proposals to close franchise services, so as to align it with the new clause introduced by amendment No. 97—proposals to close networks operated on behalf of the franchising director—and amendments to ensure that the removal of track is not treated as a closure provided that at least a single track remains. That last amendment carries forward the position under the existing closure procedures and ensures that routine track alterations can take place without triggering any part of the new closure procedures.
All the amendments are fairly technical and I again emphasise that the majority were either introduced by Opposition Peers or by the Government in response to demands from groups such as the user committees or Opposition Members.
Lords amendment No. 123 adds a new clause to the Bill which deals with exclusion of liability for breach of statutory duty. The new clause is exactly the same as the provision in section 3(4) of the Transport Act 1962 which provides that nothing that is contained in sections 3(1) or 3(2), which places a duty on BR to provide railway services in Great Britain, shall impose
any form of duty or liability enforceable by proceedings before any court to which the Board would not otherwise be subject.
In broad terms, the duties of the franchising director in respect of securing continuity of service are not to give rise to any liability for breach of statutory duty. That fairly straightforward principle is in the 1962 Act and is simply replicated in this legislation. However, to avoid doubt, that does not mean that we are seeking to exclude any proceedings for judicial review in respect of those duties of the franchising director.
9.30 pm
Similarly, any obligation on an operator not to discontinue services or the operation of a network, station or light maintenance depot without giving due notice, is not to be enforceable through proceedings for a breach of statutory duty. Those obligations will be enforceable by the regulator who will use his enforcement powers in the Bill.
It is also important to recognise that, in moving that the House doth agree with Lords amendment No. 123 and the new clause to ensure that nothing contained in sections 3(1) and 3(2) of the Transport Act 1962 places a duty on the franchising director analogous with the duties on the British Railways Board under the 1962 Act, we are not excluding liability of operators for breaches of contract or negligence. All those powers remain in place should it be appropriate for them to be used.
As I said earlier, the other amendments in the group are largely technical. It is reasonable to say that they all improve the Bill by common agreement, having received the support of Opposition Members when moved, and I trust that the House will agree to them.

Mr. Bayley: The Opposition welcome Lords amendment No. 108, which deletes the 26-week cut-off period for extensions of consultation in respect of closures. However, unlike the Minister and Conservative Members, we fear that it will have to be invoked because the privatisation is not just a sale of the railways, it is likely to be a closing down sale of the railways.
It is disingenuous of the Minister to say that the closure procedures set out in the Lords amendments simply build on the existing procedure. It is also misleading to say that the Government are introducing a simplified procedure for

dealing with minor closures. The minor closure procedure, which we have not had before, reduces the public's right to object if they are to be disadvantaged by a closure. In the past, the transport users consultative committees decided whether a closure was so minor that they had no comment to make. In future, the committees will not have that choice and the regulator will make that decision.
Nothing illustrates better the way in which the Government have approached privatisation, by making it up as they go along, than the way in which they have dealt with the closure procedures. We had a full day's debate on the matter in Standing Committee and ended up with 17 pages of legislation on the issue in the Bill that we sent to another place. A further 14 pages of legislation have come back. They are changes which were not thought of by the Government in Committee. They have arisen subsequently.
It all seemed so easy in the White Paper. The closure provisions were summed up in two very short paragraphs. Paragraph 71 stated:
There is no reason to believe that the Government's proposals will lead to closures of services. But if in future, as a result of change in demand, the Franchising Authority decided that a service was no longer socially necessary and there was no case for continuing that service then the same statutory closure procedures would apply as now. In such cases the final decision about whether a service should be retained or withdrawn will continue to be taken by the Secretary of State.
Sadly, those commitments were not to be. First, the commitment to the social railway has been deleted—it does not appear in the Bill. Secondly, the commitment to provide the same statutory closure procedures as we had previously does not appear. We have tighter time limits and a new concept of a "minor closure". There used to be a requirement to advertise in two local newspapers. That is now changed to one local newspaper, although in another place an amendment was passed that there had to be two advertisements in one newspaper.
If, as seems likely with privatisation, in respect of services from Seamer to Bridlington to Beverley to Hull, if that east coast line were to close, where would one advertise? Would it be the Scarborough Evening News, the Hull Daily Mail or the Bridlington local newspaper? It is not good enough to limit it to one newspaper.
In the White Paper, we were promised that the decision on the closure would be made by the Secretary of State, as now. In fact, it is not the Secretary of State but the regulator who will make the decision. In some cases, there is a right of appeal to the Secretary of State, but what we were promised in the White Paper is not in the Bill.
The threat of closure is real. Regional Railways has published a map on which it highlights a wide range of lines that are threatened with closure. Apart from the Scarborough to Hull service, there is the Middlesbrough to Saltburn service, the Middlesbrough to Whitby service, the Grimsby to Cleethorpes service, and the Sheffield to Barnetby service. Apart from Yorkshire, the Carlisle to Barrow service is marked in red on the map as threatened with closure. Other services include Barrow to Silverdale, Aberystwyth in Wales to Shrewsbury, Llanelli to Craven Arms and so on throughout the country, including Lowestoft to Ipswich, and, in the south-west, the Exeter to Barnstaple and the Par to Newquay services. All those services are highlighted as at risk.
Those lines do not make a profit, they provide a public service, and their future depends on whether the franchising director's budget, after other calls on it to make


main franchise services profitable for private operators, will contain enough money to maintain services. British Rail currently has 10,600 miles of passenger track. On Second Reading, the Secretary of State said that, after privatisation, the extent of the network would remain nearly the same as it is now. In Committee, the Minister said that there would not be a significant reduction in the franchised services compared with the May 1994 pre-privatisation timetable.
I should like the Minister to reiterate the commitment that the basis of services post-privatisation—the basis of the franchising agreement—will be the same as the services set out in the May 1994 timetable. I should like him also to comment on use of the phrase "substantially the same as in the timetable". Time and again, we have asked for a definition of what "substantially" means in that context, but we have never received one. Does it mean that 90 per cent., 95 per cent. or 99 per cent. of services will be protected?
What about the quality of service that is provided to the travelling public? The service can decline quite substantially without the closure procedures being introduced. I notice that in amendment No. 90, which the Minister described as a small technical tidying-up matter, there is a specific new provision that, if a line is changed from dual-track working to single-track working, it will no longer count as a closure at all. So the service can be radically reduced and undermined in a major way, which, in the past, would have resulted in a full and proper closure procedure, and, with the appointment of a regulator, even the Secretary of State can now get off the hook.
The commitments that we were offered in bland and breezy terms in two paragraphs of the White Paper have not been met in the relevant 17 pages of the Bill that went to the Lords or in the further 14 pages of amendments that have come back to us. What does the Minister say about the failure to honour the commitments contained in the White Paper?

Mr. Norris: It always strikes me as quite extraordinary that one of the more incredible flights of fancy indulged in by Opposition Members when considering this Bill is that they assume that somehow the pattern of railway services in Britain has remained immutable, unchanged and as written on tablets of stone for the past 45 years. If that had been the case, it would be worrying if the Government proposed anything to suggest that in the future those tablets of stone might be shattered.
The hon. Member for York (Mr. Bayley) is obsessed with that notion. He meanders constantly around this complex Hornby OO service—an immutable service which has not altered since time began—and he believes that the slightest movement on it will upset terrestrial equilibrium. Of course, that is and always has been nonsense.
The hon. Gentleman purports to know something about railways, but I have not been able to judge whether he does know anything in the 150 hours of debate that we have had, and I remain to be convinced. The hon. Gentleman should know that the pattern of railway services has altered in every year that the railways have been in operation.

Mr. Alex Carlile: Mostly for the worse.

Mr. Norris: That is a matter for the hon. and learned Gentleman and others to judge. Railway services have altered under Governments of both complexions—bits have been added to and removed from railway services —which is exactly what one would expect to happen as railway patterns reflect changes in demand.

Mr. Carlile: Will the hon. Gentleman give way?

Mr. Norris: If I may finish the sentence, the hon. and learned Gentleman will be welcome to enliven our proceedings, as he always does.
Let us take the extraordinary proposition that what might happen in the future is exactly what has happened in every year that the railways have existed. There will, no doubt, be minor closures and minor openings. The local press will make more of the closures than of the openings, but that is in the nature of things. We want a procedure to deal with the closures, to ensure that whenever a closure is proposed it is exhaustively debated, and all the relevant information about a service's usefulness to the local community is taken into account.
The Bill not only takes forward the current provisions for closure, but makes them wider and more comprehensive-sive. It gives the user committees more powers in relation to the publication of their reports, the disclosure of the information that they have and the observations that they can make on the closures. It is illogical and absurd to argue that because the Bill contains provisions for closures it breaches a new dyke in railway administration.

Mr. Carlile: Of course one cannot exclude the possibility of closures from time to time—that is an ordinary incident in the commercial life of a nationalised or private industry—but does the Minister not agree that, after the railways have been privatised, inevitably it will be the rural lines that are forced into closure? A privatised regime, by its own hypothesis, will be opposed to the continuation of railways in areas where there are not many customers. Should not the Government address the issue of the social need for railways and their affect on rural areas, some of which have important towns, such as Aberystwyth, on their periphery?

Mr. Norris: I have a great deal of respect for the hon. and learned Gentleman, but I do not honestly believe that any sensible reading of the Bill could lead one to conclude that the privatisation of services proposed in it has any relevance to decisions on the closure of rural or busy lines.
My reasoning is straightforward. I am sure that the hon. and learned Gentleman would agree that, in the past 40 years, there have probably been more line closures than openings, but I remind him that those took place in a nationalised industry.

Dame Elaine Kellett-Bowman: When my right hon. Friend the Minister for Public Transport was good enough to visit Lancaster, he made it quite clear that socially necessary lines and rural ones would receive a subsidy. He has since confirmed that assurance in writing to me. That means that it is highly probable that the west coast main line will be eligible to receive a subsidy. That line covers many rural areas.

Mr. Norris: I am grateful to my hon. Friend for making that point, because her remarks underline the heart of the Bill. I understand that it is in the political interests of


Opposition Members not to understand that point or to take it on board, because the minute they do so three quarters of the debate in which they have been engaged for the past months will explode.
The hypothesis is straightforward. The franchising director sets out a pattern of services that he requires the franchisee to undertake. In answer to the hon. Member for York, the timetable on which that pattern is based will, as has frequently been stated, be that operating at the time the franchise is offered. It may be the 1994 timetable or one for a later date. The important thing is that it will offer a replication of the current services.
We have used the word "substantially" according to its straightforward English meaning. In other words, the new service will be the same in every material respect as that currently on offer. That is why the hon. and learned Member for Montgomery (Mr. Carlile) should understand that the issue of the vulnerability of rural lines is not affected by the Bill. On the contrary—there will now be an open incentive to a private operator, who has already contracted with the franchising director to provide a range of relevant services, including services to some rural stations, to think about how to maximise his or her profits. The operator will wish to do that by looking at services which are currently under-used to see what can be done to make them more attractive, thus attracting extra revenue to those lines.
The franchise operator is already contracted with the franchising director, and in so doing has presumably built in the basic rate of return that would be required by his shareholders. Any improvement in the take-up of services will be to the benefit of the franchising operator. The hon. and learned Member for Montgomery would agree, of course, that that will also benefit passengers.
I must make it clear that I do not accept the argument put forward by the hon. Member for York. The new regime is a substantial improvement on the one which currently operates. It will not detract in any way from the ability of local communities to object to the closure of lines. On the contrary, it replicates and expands the existing system. On that basis, I have no hesitation in commending the amendment to the House.
Lords amendment agreed to.

Clause 7

EXEMPTIONS FROM SECTION 6.

Lords amendment: No. 7, in

Page 8, line 1, leave out subsection (6) and insert—
("(6) If any condition (the "broken condition") of a licence exemption is not complied with—

(a) the Secretary of State, in the case of a licence exemption under subsection (1) above, or
(b) the Regulator, in the case of a licence exemption under subsection (3) above,

may give to any relevant person a direction declaring that the licence exemption is revoked, so far as relating to that person, to such extent and as from such date as may be specified in the direction.

(6A) For the purposes of subsection (6) above—
condition", in relation to a licence exemption, means any condition subject to compliance with which the licence exemption was granted;
relevant person", in the case of any licence exemption, means a person who has the benefit of the licence exemption and who—


(a) is a person who failed to comply with the broken condition or with respect to whom the broken condition is not complied with; or
(b) is the operator of any of the railway assets in relation to which the broken condition is not complied with.")

Mr. Freeman: I beg to move, That this House doth agree with the Lords in the said amendment.

Madam Speaker: With this we may take Lords amendments Nos. 8 to 18, 24, 178 to 181 and 187.

Mr. Freeman: There are two aspects of this group of amendments that I shall draw to the attention of the House. First, the principle amendments Nos. 7 and 24 deal with the powers of the Secretary of State or the regulator to revoke licence exemptions when breaches occur. The Bill needed improvement to make it plain that when an undertaking that has been given and formally recognised in the licence is breached, for example, the failure to honour a commitment on through ticketing, which is to be a condition of a licence agreement and a most important network benefit, then the regulator—in certain cases the Secretary of State will grant the licence—has the power to revoke the licence exemption where an exemption has been granted.
The more important reason for amendments Nos. 8 and 16 is to do with where there is a particular group of railway lines that involves both licensed and exempt activities. We realise that there may well be examples of that and I shall cite one in a moment: the Heathrow Express, which is most important. There may well be examples on the network where the running of trains is subject to the licensing regime because the railway service is plying for hire, carrying passengers on the track infrastructure and, also, where the same railway service runs are on exempt—privately owned—track. That may well also be the case for preserved railways.
The Heathrow Express example is the best that I can cite at the present time. The Heathrow Express service has reached the stage where an agreement has been concluded and we hope that construction will start shortly. The Heathrow Express is a spur from the western mainline connecting new stations at Heathrow central and terminal four to Paddington. The House will know that that service will run on licensed main track on the Great Western railway for most of its journey. It is a joint venture between the British Airports Authority and British Rail on 70–30 equity terms, with the majority coming from BAA in the private sector. Heads of agreement were agreed in March and the detailed agreement has now been concluded. Four trains per hour will run during the day on the 16-minute journey between Paddington and Heathrow central. Fares are to be set commercially by the joint venture and the level of fares presently contemplated are £9 single and £14 return. Contracts are now being tendered and let and main contruction will be under way soon. Services are expected to commence by the end of 1997. Approximately £300 million including the cost of the rolling stock will be invested.
The group of amendments, especially Nos. 8 and 16, deals with where it is expedient for public policy purposes not to control the fares on the whole service between Paddington and Heathrow. It is a non-stop service, partly running over track that would normally carry only licensed


services and partly over a private spur. We do not think that it is sensible in any way to interfere or regulate fares that will be and should be set commercially.
The amendments also provide for the transfer of the licences, including the Heathrow Express licence, but for that to occur there needs to be the consent of the Secretary of State or the regulator. At some stage in the future, that joint venture or others that benefit from the group of amendments may need to be sold or transferred, and there is a mechanism for that. Access to Heathrow by crossrail at some stage in the future will be possible, but the commercial agreement of the partners will clearly be needed for the joint venture.
Undoubtedly, the licence conditions—the Lords amendments clarify the position—can apply, for example, to the provisions for through ticketing or to other common operating procedures. There has been some anxiety that some of the arrangements for common operation between two franchisee companies might fall foul of either the licensing conditions or other legislation. We have made it plain in the Lords amendments that such arrangements are appropriate and can be included in the licence conditions.
I should be glad to answer detailed questions on any of the other Lords amendments in the group. I commend the amendments to the House.
Question put and agreed to.
Subsequent Lords amendments agreed to.

Clause 15

FACILITY OWNERS TO PERMIT USE OF RAILWAY FACILITIES BY OTHER PERSONS

Lords amendment: No. 19, to leave out clause 15 and insert the following new clause—Access agreements: directions requiring facility owners to enter into contracts for the use of their railway facilities—

(" .—(1)The Regulator may, on the application of any person, give directions to a facility owner requiring him to enter into an access contract with the applicant for the purpose specified in subsection (2) below; but no such directions shall be given if and to the extent that—

(a) the facility owner's railway facility is, by virtue of section 16 below, an exempt facility;
(b) performance of the access contract, if entered into, would necessarily involve the facility owner in being in breach of an access agreement or an international railway access contract; or
(c) as a result of an obligation or duty owed by the facility owner which arose before the coming into force of this section, the consent of some other person is required by the facility owner before he may enter into the access contract.

(2) The purpose for which directions may be given is that of enabling the beneficiary to obtain (whether for himself alone or for himself and, so far as may be applicable, associates of his)—

(a) from a facility owner whose railway facility is track, permission to use that track for the purpose of the operation of trains on that track by the beneficiary;
(b) from a facility owner whose railway facility is a station permission to use that station for or in connection with the operation of trains by the beneficiary;
(c) from a facility owner whose railway facility is a light maintenance depot, permission to use that light maintenance depot for the purpose of obtaining light maintenance services for or in connection with the operation of trains by the beneficiary, whether the facility owner is to provide those services himself or to secure their provision by another;

(d) from any facility owner, permission to use the facility owner's railway facility for the purpose of stabling, or otherwise temporarily holding, rolling stock in connection with the operation of trains on any track by the beneficiary; or
(e) from any facility owner, permission to use the facility owner's railway facility for or in connection with the operation of a network, station or light maintenance depot by the beneficiary;

but this subsection is subject to the limitations imposed by subsection (3) below.
(3) In subsection (2) above—

(a) paragraph (a) does not extend to obtaining permission to use track for the purpose of providing network services on that track;
(b) paragraph (b) does not extend to obtaining permission to use a station for the purpose of operating that station;
(c) paragraph (c) does not extend to obtaining permission to use a light maintenance depot for the purpose of enabling the beneficiary to carry out light maintenance;
(d) if and to the extent that the railway facility mentioned in paragraph (e) is track, that paragraph does not extend to obtaining permission to use that track for the purpose—

(i) of providing network services on that track, or
(ii) of operating any network in which that track is comprised,

except where the purpose for which directions are sought is to enable the beneficiary to operate on behalf of the Franchising Director a network in which the track in question is comprised;
(e) if and to the extent that the railway facility mentioned in that paragraph is a station, that paragraph does not extend to obtaining permission to use that station for the purpose—

(i) of providing station services at that station, or
(ii) of operating that station,

except where the purpose for which directions are sought is to enable the beneficiary to operate the station on behalf of the Franchising Director;
(f) if and to the extent that the railway facility mentioned in that paragraph is a light maintenance depot, that paragraph does not extend to obtaining permission to use that light maintenance depot for the purpose—

(i) of carrying out light maintenance at that light maintenance depot, or
(ii) of operating that light maintenance depot,

except where the purpose for which directions are sought is to enable the beneficiary to operate the light maintenance depot on behalf of the Franchising Director.

(4) Any reference in this section to a person operating a network, station or light maintenance depot "on behalf of the Franchising Director" is a reference to his operating the network, station or light maintenance depot in pursuance of any agreement or other arrangements made by the Franchising Director for the purpose of performing a duty imposed upon him, or exercising a power conferred upon him, under or by virtue of this Part to secure the operation of that network, station or light maintenance depot.
(5) Nothing in this section authorises the Regulator to give directions to any person requiring him to grant a lease of the whole or any part of a railway facility.
(6) In this Part—

access contract" means—

(a) a contract under which—

(i) a person (whether or not the applicant), and
(ii) so far as may be appropriate, any associate of that person,

obtains permission from a facility owner to use the facility owner's railway facility; or
(b) a contract conferring an option, whether exercisable by the applicant or some other person, to require a facility owner to secure that—

(i) a person (whether or not the applicant or that other), and
(ii) so far as may be appropriate, any associate of that person,


obtains permission from the facility owner to use his railway facility;

and any reference to an "access option" is a reference to an option falling within paragraph (b) above;


facility owner" means any person—

(a) who has an estate or interest in, or right over, a railway facility; and
(b) whose permission to use that railway facility is needed by another before that other may use it; and any reference to a facility owner's railway facility is a reference to the railway facility by reference to which he is a facility owner.

(7) In this section—
the applicant" means the person making the application for directions;
associate", in relation to any person, includes—

(a) any servant, agent or independent contractor of his;
(b) any passenger of his;
(c) any person engaged in the provision of goods or services to or for him; and
(d) any other person who deals or has business with him;


the beneficiary" means the person mentioned in paragraph (a)(i) or, as the case may be, paragraph (b)(i) of the definition of "access contract" in subsection (6) above, according to the description of access contract in question;
directions" means directions under this section;
the Directive" means the Directive of the Council of the
European Communities dated 29th July 1991 on the development of the Community's railways;
implementing regulation" means a provision contained in subordinate legislation made for the purpose of implementing the Directive;
international railway access contract" means an access contract entered into as a result of—

(a) an application made under an implementing regulation by an international grouping to an infrastructure manager for access and transit rights, or for transit rights, for the provision of international services between the member States where the undertakings constituting the international grouping are established; or
(b) an application made under an implementing regulation by a railway undertaking established, or to be established, in a member State other than the United Kingdom to an infrastructure manager for the grant of access for the purpose of the operation of international combined transport goods services;

and expressions used in paragraph (a) or (b) above and in the Directive have the same meaning in that paragraph as they have in the Directive;
lease" includes an underlease or sublease and an agreement for a lease, underlease or sublease.

(8) Any reference in this section to obtaining permission to use a railway facility includes—

(a) a reference to obtaining, in connection with any such permission, power to obtain the provision of ancillary services relating to that railway facility, whether the facility owner in question is to provide those services himself or to secure their provision by another; and
(b) a reference to obtaining permission—

(i) to enter upon the facility land, with or without vehicles,
(ii) to bring things on to that land and keep them there,
(iii) to carry out works on that land, and
(iv) to use and maintain any things kept, or buildings or other works constructed, on that land (whether by the beneficiary or another) or any amenities situated on that land,

"facility land" meaning in this paragraph the land which constitutes the railway facility in question;

and, in subsection (2)(c) above, the reference to obtaining permission to use a light maintenance depot includes a reference to obtaining power to obtain light maintenance services at that light maintenance depot, whether the facility owner is to provide those services himself or to secure their provision by another.

(9) Any reference in this section to a railway facility includes a reference to a part of a railway facility.
(10) Schedule (Access agreements: applications for access contracts) to this Act shall have effect with respect to applications for directions.
(11) Any sums required for the making by the Franchising Director of payments in respect of an access contract entered into pursuant to directions under this section shall, if the access contract is one—

(a) in relation to which the Franchising Director is the person who made the application under this section, or
(b) under which an access option is exercisable by the Franchising Director,

be paid by the Secretary of State out of money provided by Parliament.")

Mr. Norris: Moved formally.

Mr. Freeman: My hon. Friend seeks to relegate me, Madam Speaker.
I beg to move, That this House doth agree with the Lords in the said amendment.

Madam Speaker: With this we may take Lords amendments Nos. 20 to 23, 25 to 30, 132, 182 to 186, 301 and 324.

Mr. Freeman: The amendments concern access and they are extensive. They deal with three particular issues which I am glad to explain to the House. Access and access agreements are vital to the efficient running of the privatised railway. You will be aware, Madam Speaker, that an access agreement has to be entered into by a railway operating company with Railtrack, which has the duty to ensure that it does not discriminate between train operating companies. The regulator has the power of regulations and under the Bill, he has the duty to ensure fair competition.
We envisage that the access agreement that will be entered into by the train operating companies—the passenger train companies, the franchisees—and Railtrack will run coterminously with the franchise agreement which governs the degrees of subsidy that the franchising director will pay to the train operating company. The two agreements run back to back. It is most important, under our provisions for open access to the railway, that, when it is appropriate, the Secretary of State, who has powers to give directions and guidance, can ensure that, in his dealings with the regulator, the regulator is left in no doubt about the need to moderate competition for the letting of the first franchises.
The amendments, which are largely technical, do three things. First, they make it clear that rights of access do not extend to the actual operation of the track or the stations. That is reserved, obviously, to Railtrack as the freeholder and to station lessees as those responsible for the management and operation of individual stations.
Secondly, the amendments deal with the right of access granted by the regulator generally and they ensure that rights of access do not override other rights in certain cases. Rights may already exist, for example, to run railway trains or freight trains. The regulator cannot arbitrarily grant access to new operators, because that would conflict with existing contracts and agreements. Under the provisions for granting access internationally to railway trains, especially passenger services, those agreements will be made formally under the provisions that apply to international access under the EC directive.
It is envisaged that my right hon. Friend the Secretary of State will appoint the regulator responsible for


regulating the domestic traffic as the international regulator. I think that that is his present intention. That is my right hon. Friend's function at the moment.
The amendments deal with access to railway facilities. The access provisions of the Bill as it left the Commons were deficient in a number of detailed but important respects. First, access rights were not sufficiently closely defined. It is important, therefore, to pin down exactly the rights that applicants should have and the types of contract that need to be regulated. For example, it is not our intention that management contracts relating to the operation of a station, or a lease of a light maintenance depot, should count as an access contract.
Secondly, the effect of the grant of access rights on obligations, which facility owners may owe to others, was not entirely clear. Finally, the procedures governing applications were, on reflection, too cumbersome. To ensure—
Debate adjourned.—[Mr. Andrew Mitchell.]
Debate to be resumed tomorrow.

Business of the House

10 pm

The Lord President of the Council and Leader of the House of Commons (Mr. Tony Newton): On a point of order, Madam Speaker, I should like to make a short business statement.
The business for tomorrow will now be a timetable motion on the Railways Bill followed by conclusion of consideration of Lords amendments to the Railways Bill.

Mrs. Margaret Beckett: That is a constitutional outrage. The House was told by the Leader of the House last week that we would have two full days to debate this business. By agreement with the Government, there were to be 28 debates on the important issues—such as pensions and travelcards—in which members of the British public are most particularly interested. However, the Government, who have brought to the House a Bill with nearly 500 amendments from another place, guillotine the debate on them after only part of a day's debate. It is an outrage, and the Lord President and his colleagues all know it is. They are a gutless bunch. They know that there is no support for the Bill in the country or the House. They have run away from it.

Mr. Newton: I do not accept what the right hon. Lady has said. When I made my business statement last Thursday, she did not even suggest that she thought that the time to debate the Railways Bill was inadequate. We have had a normal full parliamentary day. I accept that there was a statement at the beginning, but that is not unusual.
We have spent five hours debating two groups of amendments of relatively modest import. On that basis, I calculate that it would take 75 hours of parliamentary time, or four parliamentary weeks, to dispose of the business. That would be without allowing for proper debate on the two most significant amendments that occur in the list. If there is a constitutional outrage, it is the Opposition making such a meal of progress on the Bill.

Mr. Alex Carlile: On a point of order, Madam Speaker. You have often told the House that you are the protector of the rights of Back Benchers, and we respect that. A great many Back Benchers are taking a close interest in the Railways Bill because it affects our constituencies directly. Can it be satisfactory to you, Madam Speaker, that the House of Lords should be seen to be a more democratic debating Chamber than the House of Commons on this Bill?

Madam Speaker: Those are matters that might be debated when we consider the guillotine motion.

Several hon. Members: rose—

Madam Speaker: Just a moment. Many hon. Members want to raise points of order. I am trying to answer the hon. and learned Member for Montgomery (Mr. Carlile). Those are matters that might appropriately be raised at another time.

Mr. John Prescott: The Government told us that there would be about 28 debates. The amendments were tabled last Thursday, and the list of debates was given to us on Sunday. We have dealt with four groups of amendments, Which involved some 100


amendments and a number of clauses. I can think of no other example of a closure or a move towards a business motion for the guillotine in such a short time—

Mr. Alan Duncan: The hon. Gentleman was never in the Committee.

Mr. Prescott: In Committee, we never had a guillotine. We have co-operated in the debates. Our debates never went on for a long time. The Minister and the Secretary of State will agree. What we have is an outrage. As my right hon. Friend the Member for Derby, South (Mrs. Beckett) has said, it is a constitutional outrage that the Leader of the House has made that statement, when he is supposed to be defending the rights of Members of the House against the Government.
We cannot accept that, and we shall do all we can to oppose it.

Mr. McAllion: On a point of order, Madam Speaker.

Madam Speaker: There is no need for points of order. Hon. Members may ask questions arising out of the business statement.

Mr. McAllion: I am sorry; I did not realise that that was the case.
The Leader of the House said that the Opposition were deliberately filibustering to prevent progress on the Bill. I say to him through you, Madam Speaker, that I have been in the Chamber since the debate started at half-past 4, and he has scarcely shown his face here in that time. There has not been one complaint from Ministers or Tory Back Benchers about filibustering.
Hon. Members have been seriously debating the Government amendments. The House should be given the opportunity to continue to do that. It is a disgrace that the Government will make us go away for two weeks' holiday, but are imposing a guillotine on an important measure that will affect constituencies throughout the country. It is time that the Government realised that they cannot use their majority to trample over the rights of the British people.

Several hon. Members: rose—

Madam Speaker: Order. There has been a business statement and questions should be raised on that.

Mr. Bob Cryer: Can the Leader of the House tell us why he chose to arrange that the 10 o'clock business motion should not be moved when there are several hours of debate before us, there is no justification for his statement and he has not demonstrated that the House has used the full extent of the time available to it? He has arranged for the deliberate curtailment of debate to make the business statement at 10 o'clock, and will then curtail the debate again by moving the guillotine motion. Does not even he think that extremely unfair, when the Bill is so vital and when the Lords amendments and the Government amendments are so extensive?

Mr. Newton: As I understand it, we are operating on points of order rather than on my responding to questions, but I should appreciate your guidance on that, Madam Speaker. Let me make it clear to the hon. Gentleman that we tabled the 10 o'clock motion so as to allow for the extension of debate, on the assumption that debate was proceeding in a reasonable fashion. It manifestly was not doing so.

Several hon. Members: rose—

Madam Speaker: Order. The Leader of the House rose, on a point of order, to make a business statement. Therefore, hon. Members may now ask questions arising from that statement.

Mr. Tim Rathbone: I hate to disagree with my right hon. Friend the Leader of the House about the lack of advance in the debate but, according to Mr. Deputy Speaker, all the speeches made today were in order. Some of them went on to an untoward length, and we could have done with shorter speeches, but none of them could be ruled as just holding up the business of the House.
In the light of my right hon. Friend's statement, I ask him for a reassurance that the guillotine motion will be certain to allow a long enough time to debate two subjects of concern to many of our constituents. They are the right of British Rail to bid for franchises—the so-called Peyton amendment—and pensions. If we could not have proper debates on those matters, the Government would stand the risk of losing a considerable amount of good will.

Mr. Newton: It is certainly our aim—it was one of the reasons that led me to propose this course, because the way things were going it seemed that a lot of time would be spent on matters other than the debates on the principal issues to which my hon. Friend referred—to allow time for proper debates. Our intention and expectation is that the motion will provide for proper time in which to debate those matters.

Mr. Peter Snape: At what time did the Leader of the House take the disgraceful decision to guillotine the Bill, bearing in mind the fact that, at one stage during the debate, the only Conservative Back Bencher in the Chamber was the hon. Member for Lewes (Mr. Rathbone) and the only Minister was the Under-Secretary?
For those of us who care about the future of the railway industry, there is something deeply sickening about the fact that most of the Government Back Benchers can flock in at 10 o'clock to support the disgraceful guillotine, yet none could be here to take part in the debate. Does the Leader of the House agree that the Opposition are not filibustering, but that the shower on the Government benches are neglecting their duties?

Mr. Newton: The decision to table the timetable motion was taken as we saw the progress of debates and as we recognised the statistics. As I told the right hon. Member for Derby, South (Mrs. Beckett), if this rate of progress continued, the House would still be debating the Bill in December.

Mr. Duncan: Does my right hon. Friend agree that those who sat on the Committee can confirm that the Bill has been examined line by line, clause by clause—[Interruption.]

Madam Speaker: Order. I cannot hear the hon. Gentleman. Hon. Members who want to be called must let the House hear what everyone has to say.

Mr. Duncan: Will my right hon. Friend confirm that the hon. Member for Kingston upon Hull, East rarely turned up to the Committee, and that he slouched in and


slouched out? Is not his stunt tonight no more than another stunt to try to become the deputy leader of the Labour party?

Mr. Newton: I did not have the privilege of being a member of the Committee and I cannot testify to the hon. Gentleman's attendance record. However, the Bill has had 183 hours of debate here and in another place. That figure includes 109 hours in Standing Committee. There can be no question of a constitutional outrage following the amount of time that has been devoted to the Bill.

Mr. Nigel Spearing: The Leader of the House told my hon. Friend the Member for Bradford, South (Mr. Cryer) that insufficient progress was being made on the Bill. Why is he not moving a motion that would allow business to proceed?
Will the Leader of the House tell the House what he has in mind for tomorrow? What time will he table the motion—presumably one must have been drafted—for the debate to finish and only outstanding votes be taken? Does the right hon. Gentleman remember a Bill in the early 1970s during progress on which considerable voting went on through the night on remaining motions to be taken?

Mr. Newton: The motion that I propose to table will provide for a further five hours of debate on the Bill.

Mr. Peter Luff: Does my right hon. Friend accept that there will be a general welcome among Conservative Members for the decision to table a motion of this kind? I came to the House with high hopes of having a serious debate about the issues that were raised by the amendments, two of which were highlighted by my hon. Friend the Member for Lewes (Mr. Rathbone). Does my right hon. Friend agree that we have been treated to nothing but a series of Second and Third Reading speeches?

Mr. Newton: I am grateful to my hon. Friend, whose vies, I suspect, will be widely shared on the Government benches.

Mr. Archy Kirkwood: Will the Leader of the House tell the House the last time that 400 Lords amendments were brought in by the Government in a two-day debate in advance of a recess period of some 14 days between the prorogation of a Session and the Queen's Speech? Is it not possible to find some extra time during this week or early next week to give the Bill the consideration it surely deserves?

Mr. Newton: A substantial number of amendments have come here from another place, but the hon. Gentleman knows well that the vast majority are of a character that one could properly describe as technical.
We have sought to provide what we believe to be adequate time, taking account of the subject matter. I believe that we have allowed the longest period for Commons consideration of Lords amendments for about two years. I will resist the suggestion that inadequate time has been allowed. What has happened today is that adequate time has been misused to the detriment of proper discussions of the Bill.

Dr. John Marek: The Leader of the House has not been in the Chamber for all of today's debate. May I draw to his attention—I hope that he will accept the point

after consulting his right hon. and hon. Friends—that, on the penultimate set of amendments, only the Minister spoke, and that the amendments were accepted without Division?
Opposition Members were prepared formally to accept the amendments that we were debating at 10 o'clock, but the Minister said that they were important amendments, and spoke to them for five minutes. Does the Leader of the House accept that the Bill has been substantially rewritten, and that, although the changes might be matters of detail, they are matters of vital detail?
I hope that the guillotine motion that is tabled tomorrow will ensure that there is adequate time for debate. I hope that the Government will not try to wrap up the business by tomorrow night. I hope that you will use what influence you have, Madam Speaker, to resist that, as it would be intolerable. As my right hon. Friend the Member for Derby, South (Mrs. Beckett) said, it would be a constitutional outrage if that were allowed to happen.

Mr. Newton: In response to the hon. Gentleman, I simply advert to the point that I have now made twice. At the rate of progress that was made on two amendments, neither of which were among the significant amendments referred to by my hon. Friend the Member for Lewes, it would take a parliamentary month to complete consideration of the Bill.

Mr. Alfred Morris: Can we have from the Leader of the House the detailed terms of the timetable motion? Clearly he knows the details. Why not tell the House of Commons tonight? He said that there were two outstanding and crucial issues. What is the maximum time available tomorrow for debating those issues?

Mr. Newton: I have already said that the guillotine motion will provide for five hours of further debate. That time would be available for debating the issues to which the right hon. Gentleman refers.

Mr. Matthew Banks: Will my right hon. Friend make it clear that it will be possible tomorrow to debate the amendments which deal with pensions, and the so-called Peyton amendment referred to by my hon. Friend the Member for Lewes (Mr. Rathbone)? Does my right hon. Friend agree that the points made by the Opposition came from hon. Members who spent virtually no time in the Chamber during the debate this afternoon?

Mr. Newton: I am grateful to my hon. Friend. I repeat that, in my judgment, five hours is an appropriate and reasonable amount of time for the further debate required on the Bill.

Mr. Donald Anderson: Will the Leader of the House bear in mind two factors? When two days were originally assigned for consideration of the Lords amendments, first, it was assumed that the Monday would be open-ended; and secondly, it was not thought that there would be a statement which would take more than one and a half hours and would cut into the debate. Surely even this Leader of the House must recognise that to use the tactic of the guillotine in this way at this time is a dangerous matter, and that he is fashioning a weapon that one day will be used against his side.

Mr. Newton: Might I say to the hon. Gentleman, who is a Member I respect, that this is only the second such


motion that I have moved on a significant Government Bill; so I can hardly be accused of being slap-happy with timetable motions. I shall make a point that I made earlier in a slightly different form. I accept that there was a statement. Other things being equal, that would have made us more inclined to suspend the rule and continue with the debate this evening. However, we did not do so on the basis that the House took five hours to discuss two reasonably limited amendments.

Mr. Brian Wilson: The Leader of the House has repeatedly said that it took five hours to discuss two amendments. Will he confirm that that is the basis on which he made his judgment? In line with his apparent general ignorance of the Bill that he is guillotining, the right hon. Gentleman is wrong on that factual point. We have not dealt with two amendments. We were dealing with the fifth group, and each included a large number of amendments. Is the Leader of the House aware of that or has he been given some nonsense to read to the House which is in direct contradiction of the reality?
Will the Leader of the House confirm that there has been absolutely no time-wasting? Despite his apparent ignorance of the subject that he is dealing with, does he regard the financing of Railtrack, the franchising procedure, the closure procedure and the access charging procedure, all of which we have already dealt with, as minor matters that should be waved through the House?
Does the right hon. Gentleman further confirm that, although we had many hours in Committee, we did not have a guillotine motion? There are 470 amendments from the other place which deal not with minor or technical matters but with major changes to employment rights, a right to bid and, above all, the pension rights of hundreds of thousands of people. They are major issues, not minor or technical ones. Can the Leader of the House confirm that we have had no time to debate the amendments, other than the four hours of debate this afternoon?
Finally, does he understand that it is well understood outside the House, especially when we are about to go on two weeks of unasked-for holiday from this place, that the Government are closing the debate on these matters because they fear debate on them? The body of opinion outside the House already regards the legislation as discredited and being rushed through the House by Ministers who base their actions on dogma and prejudice,and that impression will be confirmed by the disreputable action taken tonight.

Mr. Newton: So far as the first part of what the hon. Gentleman said is concerned, I made it clear that I was referring to the amount of time taken to discuss the first two groups of amendments, which was in the order of five hours. In our view, that meant that there would not be sensible and orderly debate on the remaining amendments in a way which would concentrate on the major issues. Our expectation and hope is that the timetable motion will enable that debate to take place.

Cervical Smears Inquiry (Greenock)

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Andrew Mitchell.]

Dr. Norman A. Godman: Madam Speaker—[Interruption.]

Mr. George Foulkes: On a point of order, Madam Speaker.

Madam Speaker: Order. The hon. Member for Greenock and Port Glasgow (Dr. Godman) has a good voice, if he tries to use it. Come on!

Dr. Godman: I always use my voice properly, Madam Speaker, even when I am being reprimanded by your good self in that charming way.
I shall begin by asking the Minister a serious question because I could argue that I have been misled with regard to a request that I made to him. On Thursday, I asked him for a copy of the response of the Argyll and Clyde health board to the report into the cytology laboratory at the Inverclyde Royal hospital in Greenock. I have an idea that the copy that I received from his office is incomplete. My copy of this important report ends at paragraph 2·5.
I understand that section 3 of the report, which is a response to Dr. McGoogan's report, deals with such matters as discipline and the need for the hospital to be allowed to continue with its application for trust status. I do not believe that the hospital should be given trust status until certain serious concerns involving the management of the hospital are sorted out. I shall welcome the Minister's response to my comment about the incomplete copy of the report that I received from his office. It might have been a genuine mistake, but I am concerned that the report which I have ends abruptly at section 2 of that document.
The Minister and I are here to exchange views on the report of the inquiry into cervical cytopathology at the Inverclyde Royal hospital at Greenock. The four authors of the report are leading experts in their respective fields. They have produced a unanimous report, despite what some members of the health board would have us believe.
Although the Minister and I may disagree profoundly on various aspects of the report, I think that we are at one in our concern to ensure the restoration of public confidence, not only in Inverclyde Royal hospital in Greenock but in the national cervical smear test programme. I am sure he agrees that that confidence, which has taken about four decades to build up, was badly damaged by this scandalous affair at Inverclyde Royal hospital.
When the misreporting of smear test slides was first reported six or seven months ago, not only my constituents but those of my hon. Friends the Members for Dumbarton (Mr. McFall) and for Renfrew, West and Inverclyde (Mr. Graham) and those of the hon. Member for Argyll and Bute (Mrs. Michie) were deeply dismayed at the board's admission that something had gone terribly wrong. We all have a duty to restore public confidence in the hospital and to restore the morale of its staff.
However, we should not allow this scandalous affair to be swept under the carpet. Ten days ago, Mr. Robert Reid, the chairman of the Argyll and Clyde health board, urged us all to set this unfortunate incident behind us. Mr. Reid's "unfortunate incident" was described to me by an angry,


distressed woman constituent as "this bloody scandal." That is a graphic but accurate description, while Mr. Reid's description is in itself unfortunate.
Thousands of smear test slides were misread by hospital employees who, as the report states in page 56, paragraph 6.25 worked
in a laboratory which was known to have been over-worked, under-staffed, antiquated and isolated.
Senior medical staff and senior health board officials knew that, but nothing was done about it.
In our surgeries women constituents have told us about having to go back for fresh smear tests. Some of them had to undergo hospital treatment. Is that the way to run a hospital? Is no one to be disciplined over this affair?
The Minister knows that the bruising of local confidence in the hospital was exacerbated by a recently highly contentious and controversial television programme about the hospital. In the interests of patients and hospital staff, we need an independent inquiry into the management of the hospital. That view is shared by many of my constituents and others elsewhere in Inverclyde.
Last week I received a letter from a young woman employee at the hospital. The letter states:
The recent incidents which have resulted in bringing Inverclyde Royal under the public spotlight have further demoralised staff and undermined patient care. At the IRH all staff regret this.
Only full independent investigations into all areas of concern will restore public and staff disquiet.
I am quoting accurately, but I think that the young woman means that such investigations will restore public and staff confidence in the hospital. The letter continues:
One welcome first step is the decision to refer surgical procedures to the Royal College of Surgeons.
That young employee is referring to a decision by the Argyll and Clyde health board to invite members of the Royal College of Surgeons in Glasgow to conduct an inquiry into surgical services at the hospital in response to the television programme. I understand that the president of the college, Professor Donald Campbell, declined the invitation on the ground that such an investigation was impossible to conduct unless it was properly constituted. I quote from the Greenock Telegraph of 27 October:
In my view an independent inquiry would lead to the hospital being given a clean bill of health.

Mr. John McFall: Will my hon. Friend give way?

Dr. Godman: My hon. Friend told me prior to the debate that he wished to contribute, but in the hurly-burly at the start of my remarks I forgot to ask the Minister for his agreement to that.

The Parliamentary Under-Secretary of State for Scotland (Mr. Allan Stewart): indicated assent.

Dr. Godman: I ask my hon. Friend to be brief.

Mr. McFall: My hon. Friend will be aware that, in my constituency last year, 1,000 smear tests were sent to the Inverclyde Royal hospital. Does he agree that the public will be satisfied only if some disciplinary action is taken at board level?
On Friday 5 April last year, I had an interview with the district manager of my hospital. He subsequently told me that at that time he had known of the problem with the smear tests, but had decided not to convey that information

to me, the Member of Parliament. Instead, he waited a month before doing so. Does my hon. Friend agree that the procedures within the board are wrong and that something has to be done—and the Minister must undertake it—so that public confidence can be restored?

Dr. Godman: I agree with my hon. Friend. As I said earlier, this sorry affair, which has caused so much distress and anxiety among so many women in Inverclyde and elsewhere, should not be seen merely as an unfortunate incident that is now behind us. One question that I wish to put to the Minister, which has been prompted by my reading of the report, is what procedures exist to enable senior managers and, indeed, the Scottish Office to monitor the wrongful, careless or neglectful conduct of senior consultants and, just as important in such a matter, senior hospital administrators. Are those people above discipline? They certainly appear to be above resignation.
I have the greatest respect for the doctors, nurses and ancillary employees at the hospital, the overwhelming majority of whom provide a superb service for their patients. However, there are serious problems with the management of the hospital, and that needs to be examined. I therefore repeat my first question: what procedures exist to allow for the vigorous examination of inappropriate, careless or neglectful conduct by senior consultants, medical administrators or health board officials?
I want to ask the Minister a number of questions, to some of which I have already alerted his staff. Dr. McGoogan and her colleagues say on page 9 of their report:
The high false negative rate is not the responsibility of one individual alone but can be attributed to deficiencies in … the approach of the Argyll and Clyde Health Board to cervical screening
and to
the staffing and operation of the laboratory.
In no way do I want a witch hunt of the two individual senior medical people who have direct responsibility. The ultimate responsibility rests with senior management and the board.
On the question of discipline, I accept what the Minister of State, Lord Fraser of Carmyllie, said when I demanded the resignation of the chairman of the board and other disciplinary measures. He wrote:
As to disciplinary action against senior staff this is a matter solely for the Board. You will appreciate that the Secretary of State could have an appellate role where senior staff are concerned and it would be inappropriate for me to offer any further comment.
However, we should not allow Ministers to make that sort of statement without conducting some sort of investigation and seeking some response from the board about disciplinary measures.
Paragraph 4.8.7 on pages 31 and 32 of the report states:
As at 25th August 1993, one hundred and fifty-two women with results other than negative"—
in other words, with results other than normal—
and seven hundred and forty-four women with normal results remain untraced.
I am deeply concerned about that former group—those whose smear tests displayed some form of abnormality but who had not been traced as late as the end of August. What is the Scottish Office doing by way of urging the health board to take every measure to locate each and every one of those 152 women? Naturally it is my hope, and I am sure of all hon. Members present, that each and every one of them will be given a clean bill of health.
The board, assisted by the Scottish Office, must make every effort to trace those women. If the Minister can say tonight that they have been traced and cleared, no one will be happier than me. Some of those women could be in danger and they must be traced.
Similarly, it is essential that the 744 women with normal results come forward for proper smear tests. I am sure that I have the Minister's support in that matter.
It appears that the board was less than helpful to Dr. McGoogan and her colleagues. The Minister may dispute that, but paragraph 5.2.5 on pages 34 and 35 of the report states:
A request was made for smears to be rescreened and for the histology reports and slides to be reviewed at Inverclyde Royal Hospital to verify the diagnosis and stage of the disease. Despite repeated requests, the information does not link the date and stage of diagnosis of invasive cervical cancer to previous smear reports from these individual women.
I hope that the Minister will address that aspect.
Despite all the criticisms levelled against Dr. Stanworth, paragraph 6.4 of the report states:
Dr. Stanworth's diligence was also apparent in her willingness to work long hours often without remuneration and at the expense of her own private life.
That individual was engaged in incredibly onerous and difficult work. Together with the Minister for Health, I spent half a day in Dr. McGoogan's laboratory and received some indication of the difficult nature of the work. Dr. Stanworth was working for the health board unpaid—that is how the board treated that loyal servant.
As to acceptance by the Under-Secretary of State for Scotland and by other Ministers in the Scottish Office of the report's recommendations, the Under-Secretary of State stated last Thursday, in answer to a written question of mine, that he and his colleagues accepted the seven recommendations directed at the Scottish Office.
Perhaps the Minister will say something about the need rapidly to implement the recommendation in paragraph 6.36 on page 60 of the report for a
national health education programme to improve understanding of the benefits of regular screening.
The Scottish Office has accepted that. At Thursday's sitting of the Scottish Grand Committee, I said how pleased my hon. Friend the Member for Renfrew, West and Inverclyde and I were with the many courtesies shown to us by the Minister. However, I am sure that my hon. Friend—who has many thousands of constituents involved in this sorry affair—will agree that we need a national health education programme.
I know that difficulties are involved in bringing the various specialists together; but it seems to me that such a programme is needed, in the light of what has happened at Inverclyde Royal hospital and, more recently, the taking of smear tests in Gateshead and elsewhere in England. It is needed to persuade women to return to the smear-test programme. Confidence has taken a battering. I hope that the Minister will spend a moment or two replying to that question.

Mr. Thomas Graham: As my hon. Friend knows, there has been much concern about the problem, and about the lack of confidence experienced by many women in our area. It is important for the Government to recognise that, and to provide enough money to persuade women to ensure that they do not miss tests but follow them up and have

confidence in them. I am also worried—as I know my hon. Friend is—that clinicians seem to be getting out of some of the accusations scot free.

Dr. Godman: I thank my hon. Friend for his intervention.
I am sure that the Minister will support what I am going to say now. The cervical smear test programme is very important in its own right. Cervical cancer is easily detectable in its precursor stage and it is essential that women's confidence in the programme is restored. I hope that every hon. Member supports me in that view.

The Parliamentary Under-Secretary of State for Scotland (Mr. Allan Stewart): I congratulate the hon. Member for Greenock and Port Glasgow (Dr. Godman) on obtaining an Adjournment debate on a subject that is of great importance to his constituents, but whose wider importance is shown clearly by the attendance of my hon. Friends the Members for Dudley, West (Dr. Blackburn), for Ayr (Mr. Gallie) and for Edinburgh, West (Lord James Douglas-Hamilton), and the hon. Members for Glasgow, Maryhill (Mrs. Fyfe), for Dumbarton (Mr. McFall), for Glasgow, Provan (Mr. Wray), for Renfrew, West and Inverclyde (Mr. Graham), for Argyll and Bute (Mrs. Michie) and for Moray (Mrs. Ewing).
I entirely agree with what the hon. Member for Greenock and Port Glasgow said about the importance of reassuring women—not just in the Inverclyde area, but nationally—about the smear test programme. Because time is limited, I will not go into the details of the background to the action taken by my right hon. Friend the Secretary of State and my right hon. and noble Friend the Minister of State. As the hon. Member knows, the inquiry was announced under the independent chairmanship of Dr. McGoogan on 28 April. Its findings were made public, and—as I will explain to the House—are being implemented.
I hope that the House will agree that, by announcing that independent inquiry, the Government demonstrated that they wished to move quickly to explain the position to the general public and to offer the reassurances whose importance hon. Members have rightly emphasised.
I am happy to reassure the House that, as at this date,
none of the women concerned were found to have invasive cancer. I agree with the hon. Member for Greenock and Port Glasgow about the stress of the exercise, but I hope that the House will be reassured by that outcome.
I am sure that the House will accept that the inquiry team completed its task despite a demanding time scale, beginning work in early May and publishing its report on 9 September. The report has been widely distributed throughout Scotland, the United Kingdom and worldwide. As hon. Members know, a copy was placed in the Library.
The report should reassure women in Scotland of, first, the health benefits of regular smear testing and, secondly, that implementation of the recommendations will reinforce the already high standard of the screening programme in Scotland.

Mrs. Maria Fyfe: Will the Minister give way?

Mr. Stewart: I shall give way, but I am sure that the hon. Lady will appreciate the pressure on time.

Mrs. Fyfe: Will the Minister give the time scale within which the recommendations will be implemented?

Mr. Stewart: I give the hon. Lady the general assurance that the Government are determined to ensure that progress on implementation proceeds as quickly as circumstances will allow, with continual monitoring of progress. May I spell out what that means in detail?
The report's recommendations fall into three main categories—those directed at the Scottish Office Home and Health Department, those directed at the health board and those directed at its laboratories. The aim is to implement these as quickly as practicable. The process involves consultations and discussions with professional bodies, health bodies and trusts on the details.
Of the seven recommendations directed to the Scottish Office Home and Health Department, we have already announced that we shall set up a central co-ordinating unit for cervical screening on similar lines to that in place for the Scottish breast cancer screening programme. That will be funded centrally, at an estimated cost of£100,000 per annum. There is a guarantee on the future of the proficiency testing scheme, which costs an estimated£20,000 per annum and is an important element in maintaining standards of smear testing in all NHS laboratories.
We are preparing and will issue guidance to health boards, trusts and their laboratories on proposals in respect of training, staffing—including grading and staffing levels—health education and the rationalisation of laboratories.
The hon. Member for Greenock and Port Glasgow asked in particular about health education. I confirm that discussions have already taken place with the Health Education Board for Scotland on promoting a national health education programme to improve awareness of the benefits of regular cervical screening. The results of the discussions will be reported to the House in due course.
We are now working to finalise the membership of the working groups, which will address quality control and guidelines for training techniques in smear taking, staffing and the rationalisation of laboratories. The handling of perceived reporting discrepancies, as I told the Scottish

Grand Committee, will be looked at in the light of the report of the Calman committee, which was set up following the problem in Birmingham.
On the recommendations directed to the board and its laboratories, the hon. Member for Greenock and Port Glasgow will know that the health boards set up a task force headed by a senior health board member. It has produced an interim report, and a formal report was submitted on 27 October to the chief executive of the management executive. He is studying its contents and will closely monitor implementation.
I confirm that the board has already implemented the recommendations which ensure that monitoring and evaluation include the comparison of statistical returns and an audit of the screening history of all new cases of squamous carcinoma of the cervix and that all aspects of quality assurance are exercised in the laboratory and funded accordingly. The board has confirmed that it will make provision for continuing education for technical and medical staff of non-training grades and that a person in each hospital should ascertain that all staff make use of it.
The board accepts all but two of the remaining recommendations directed at it and proposes to implement them once a further investigation of possible options and alternatives has been fully carried out by a health board working group. The board considers that the two recommendations will require a longer period of implementation but they have been accepted by the board.
I am aware that, in the time available, I have not answered every detailed question asked by the hon. Member for Greenock and Port Glasgow, but I assure him that I shall write to him with those detailed answers. I shall, however, respond to the very important question about the number of women still to be traced. There are 69 women still to be traced, 53 of whom are thought to be in the United States. The board is liaising closely with the United States' authorities and following up addresses of women and their relatives elsewhere in the United Kingdom.
The motion having been made after Ten o'clock and the debate having continued for half an hour, MADAM SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
Adjourned at nine minutes to Eleven o'clock.